Heritage Building Society has experienced growth over the last two quarters that bucks the trend in a market that now favours banks over non-banks. "Our lending has been really strong in Queensland, and it has been really strong over the border as well. Approved loans are up over 25 per cent this financial year," said Heritage Building Society chief executive John Minz.Minz said the very strong lenders figures are due to strong broker partner relationships established over the last ten years and direct business through branches."We have built a very diversified funding base, which comes from our retail base which is up between eight and ten per cent since July this year, with a wholesale funding from the small to medium wholesale lenders such as councils."Despite the impact of the credit crunch, the wholesale funding hasn't gone through the roof. And we use securitisation."On that option, though, Minz said, "We won't enter the market until it's right to do so."In the next six months a key focus for our sales staff will be growth in the retail and term deposits, which is a steady and stable area, plus a reasonably low cost form of funding."In financial year 2007, Heritage residential lending grew at only around two thirds of system growth, but the branch expansion increasing by 50 per cent in the last three years is beginning to pay dividends.The below system growth can be attributed to Heritage's offering only full documentation loans, and in recent months mortgage delinquencies have surprisingly fallen."For loans in arrears over thirty days, we have decreased from around 0.4 per cent (30 June) to 0.3 per cent."We are not seeing a rise in delinquencies, and that's across the products range and not just mortgages. "We have a strong discipline in ensuring members can pay back the loan, and in qualifying for a loan there is a buffer to make sure they can satisfy their loan repayments even when rates go up."