Non-bank lending soars

The global advisory firm's latest survey of non-bank lenders shows non-bank lending grew by 9.32% in the year to June, up to $13.35 billion.

Mortgages represented the bulk of the new business, yet asset finance and personal loans also rose during the 12 month period, the firm said.

Non-bank mortgages made up about $3 billion of the total, according to the report, amid a "continued tighter lending black box" among the established major lenders.

Net profit after tax for non-banks rose by 16.49% to more than $324 million last year, according to KPMG's Non-Bank Financial Institutions Performance Survey 2019 report.

The review surveyed 24 of New Zealand’s non-bank financial institutions. It comes as the non-bank sector heats up, with Resimac and Bluestone entering the market in recent years; and Australian giant Pepper Money taking its first step into New Zealand earlier this year.

KPMG said a changing environment for banks, including fallout from the Royal Commission and the RBNZ's new capital rules, would likely play into the hands of non-bank lenders in the years to come. 

John Kensington, KPMG’s head of banking and finance, said: "This will see banks lend less, and some customers will have to come to the non-bank sector to get the credit they require."