Finance Ireland doubles mortgage lending as broker channel gains clout

Finance Ireland doubled its residential mortgage lending volume in 2021 when the company launched Ireland’s first 20-year fixed rate home loan.

The non-bank lender, which also specializes in auto finance and commercial mortgages, tripled its pre-tax profit to 28 million euros during the year, on the back of significant volume growth and the release of provisions for Covid-19.

The company’s most recent balance sheets show it generated more than $1 billion during the year.

Home loans accounted for half of that business and Finance Ireland now has a 5.3 per cent market share, with a 13 per cent share of the growing broker channel which now accounts for half of new mortgages in Ireland.

According to Founder and CEO Billy Kane, Finance Ireland had targeted between €300m and €450m in new mortgage origination for 2021, but exceeded the upper end of that range with deal volume of €552m.

“2021 was a record year for the group, demonstrating continued strong demand from businesses and consumers for a new approach to lending,” said Mr. Kane, whose pay nearly doubled to €841,000 in 2020 following a significant pandemic pay cut.

“Despite the ongoing impact of Covid-19, the business has performed strongly and our capital raising in 2022 puts us in an exceptional position to fund further growth across the business.”

Finance Ireland raised €50m in fresh equity in July in a series of deals in which its debt financier M&G Investments and long-term shareholder Pimco bought out the Irish Strategic Investment Fund (ISIF) and around 120 legacy investors.

ISIF left its 33 percent stake in the firm for nearly €70 million – about a 50 percent return – leaving M&G with 41 percent, Pimco with 49 percent and management with 10 percent.

The deal, which came about in lieu of a delayed IPO in May 2020, valued the company at nearly €260 million and underscored Finance Ireland’s strong position as Ireland’s largest non-bank lender.

M&G had funded the company’s foray into long-dated fixed income products back in the first half of 2021 — perfect timing given the surge in inflation and rising interest rates that followed that year — and followed its money with a sizeable equity investment this year.

Despite tightening monetary conditions and rising costs of living, mortgage lending has remained buoyant and is on track to surpass €10 billion in 2022 amid strong demand for homes in an underserved market.

In addition, the exit of Ulster Bank and KBC Bank Ireland from the domestic market has freed up around 25 per cent of the mortgage market, with an increasing flow going to non-banks via influential brokers.

“While we are aware of the economic challenges posed in particular by the sharp rise in the cost of living and energy prices, the Irish economy has shown exceptional resilience both during and after the pandemic and we remain optimistic about the opportunities ahead,” said Mr. Kane.

https://www.independent.ie/business/personal-finance/property-mortgages/finance-ireland-doubles-mortgage-lending-as-broker-channel-grows-in-influence-42021621.html Finance Ireland doubles mortgage lending as broker channel gains clout

Fry Electronics Team

Fry Electronics.com is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – admin@fry-electronics.com. The content will be deleted within 24 hours.

Related Articles

Back to top button