Broking turnover rises for YBR

Yellow Brick Road is making modest progress in generating more revenue from mortgage broking and related financial services' business.

The 2011 financial statements show that YBR earned A$3.8 million in revenue from mortgage broking over the year, or about a third of the $11 million turnover of the company during the year.

The prospectus for the $12.5 million capital raising and relisting of YBR, released in April, showed that broking accounted for 27 per cent of half-year turnover.

Yellow Brick Road incurred a loss of $2.6 million after tax, which management said was "in line with our expectations based on significant investment in growth in the business".

YBR distributes prime home loans funded by Gateway Credit Union (under a two-year agreement due for renewal at the end of this year) as well as non-conforming home loans funded by Resimac (under an open-ended agreement reached in late 2010). It also operates as a mortgage broker in conjunction with the aggregation group, Connective.

Connective separately disclosed this week that its level of home loan approvals from all sources (including YBR) exceeded $1 billion a month for several months, a record level of business for the firm.