MA Financial Group plans to use its A$145 million acquisition of mortgage aggregator Finsure, which was completed earlier this month, as the platform for a much bigger presence in the mortgage market.
The company started life as Moelis and Co in 2009 as a corporate advisory and investment banking firm before expanding into asset management, specialising in real estate, hospitality, private credit and private equity. Asset management now accounts for 69 per cent of earnings.
The company was listed on the ASX in 2017 and changed its name to MA Financial Group last year.
It entered the lending market in 2018 as a speciality lender, providing legal disbursement funding, which it funds through income-focused managed investments. In recent times it has added residential mortgage lending to the mix.
Last year its loan portfolio grew 44 per cent to $455 million. Net interest income grew 30 per cent to $19.9 million and underlying EBITDA grew 13 per cent to $10.3 million. Lending contributed 10 per cent of group EBITDA.
The lending business generated a healthy net interest margin of 5.3 per cent in 2021. NIM came down from 8.8 per cent in 2020, reflecting the change in the portfolio mix from speciality finance to residential mortgage lending.
MA Financial is happy to give up NIM to grow in the “highly scalable” mortgage market, and that is where Finsure comes in.
Finsure’s aggregation business supports more than 2000 brokers and has a $60 billion loan book.
Speaking that MA Financial’s 2021 results briefing yesterday, joint chief executive Julian Biggins said the company’s view is that non-banking lending in Australia will grow as a proportion of overall lending and the company is building a platform that will allow it to compete on a substantial scale.
“Finsure adds tech-enabled distribution infrastructure, which enhances our expansion into the residential mortgage market. What we are doing is enabling scale,” Biggins said.
He also praised the Finsure team, led by John Kolenda. Fifty-one Finsure staff have moved with the acquisition.