Resimac boss ‘cautiously optimistic’ about group’s outlook

Speaking at Resimac Group’s 2023 annual general meeting (AGM), Resimac CEO Scott McWilliam has expressed that he is “cautiously optimistic” about the group’s future outlook.

Mr McWilliam said with the major banks scrapping cashback offers and new business incentives, there should be “more of a level playing field moving forward” in regard to competition for prime customers.

“We are seeing increased system activity as we come through the spring sales season, particularly for refinancing, with many borrowers rolling off fixed rates,” he added.

“These macro-economic factors should help increase prime and non-prime settlements in FY24.

“We strive to offer competitive products to consumers and be a meaningful alternative to the banks and I’m pleased to say that we’re already seeing lending activity pick up again.”

Also speaking at the AGM, Resimac chairman Warren McLeland said financial year 2023 was the “toughest year of operations since the end of the GFC in 2010/11”, being dominated by increasing geopolitical risks and economic uncertainties, such as rising inflation and interest rates.

Mr McWilliam added that the company’s residential mortgage numbers are “tracking well into the second quarter of FY24”.

According to the CEO, Resimac’s home loan applications in September had hit a 12-month peak, with momentum continuing throughout October off the back of targeted product offerings.

“There is also material growth potential in our asset finance business,” Mr McWilliam said.

“Our market share has increased among brokers, and with new additions to the team and a new originations platform, I’m confident we’re well-resourced to support a greater volume of asset finance settlements in the year ahead.”

Indeed, Resimac previously flagged in its full-year results for the financial year ended 30 June 2023 that it would home in on its asset finance growth during FY24, with target settlements of $1 billion.

To achieve this, Resimac would need to more than double its FY23 figure of $428 million, which was already a 19 per cent increase on FY22.

Mr McWilliam commented at the time: “Our growth aspirations for asset finance remain high, we’re targeting to double our asset finance settlements in FY24, underpinned by a wider broker reach and a significantly improved digital experience for our broker partners and customers.”

Furthermore, Resimac’s mortgage arrears stabilised during the second half of FY23. Mr McWilliam stated the non-bank lender’s “prudent approach to credit risk” has allowed its balance sheet to contain low loss exposure.

Home loan settlements drop in FY23

Resimac’s home loan settlements fell to $3.7 billion in FY23, down 41 per cent from FY22, with prime settlements down 56 per cent to $1.1 billion and specialist settlements loan falling 31 per cent to $2.6 billion.

The non-bank lender’s total home loan portfolio decreased 14 per cent to $13.1 billion by the end of FY23, with prime AUM having reduced 23 per cent to $7 billion and specialist AUM remaining broadly flat with a slight fall of 5 per cent to $5.8 billion.

[RELATED: Resimac strives for further asset finance growth in FY24]