Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Motor Trade Finance profit falls as Turners goes in-house

By Paul McBeth

May 27 (BusinessDesk) - Motor Trade Finance reported a 2.6 percent decline in first-half profit as the auto lender wrote less business with Turners Automotive Group.

Net profit fell to $4.2 million in the six months ended March 31, from $4.3 million a year earlier. MTF wrote $253 million of new loans in the half, down from $318.3 million a year earlier.

MTF said $49.3 million of the reduced lending was due to less business going through Turners. A non-recourse loan offered with Turners' Oxford Finance was discontinued after tighter lending criteria sapped demand for the product. Turners also brought more business in-house, diverting lending that had previously been done by MTF.

The auto lender's receivables still grew to $681.1 million as at March 31 from $651.7 million a year earlier. Its interest income increased 4.9 percent to $44.7 million, while commission payments rose 7.1 percent to $21.1 million.

The company said it has sufficient capacity to fund forecast growth with $52.8 million of its securitisation facilities undrawn at March 31. From April 15, its $250 million warehouse funding facility was increased to $300 million.

MTF is seeking to boost lending in tandem with Trade Me Group after a pilot project introduced a finance option on the website's listings and generated $1.5 million of new loans through to the end of March.

"We have made progress on replacing lost non-recourse business through the partnership with Trade Me, and more is required," the company said.

"We will continue to balance our focus on retaining our share of the market while looking to the horizon and positioning MTF Finance so it can adapt quickly in a rapidly changing market."

MTF has been a beneficiary of successive years of record new vehicle sales as a strong currency kept imported cars cheap, economic growth generated new jobs, and low interest rates made it easier to finance big-ticket items.

It warned that "unprecedented" growth is now in decline, citing the slowing global economy, weaker domestic spending, and dwindling business confidence.

MTF noted the extra scrutiny lenders are under since Australia's royal commission and New Zealand's proposed changes to consumer finance law.

"While it is too early to identify the impact on us as a business, and on our customers, we are continuously monitoring activity to ensure we maintain our commitment to responsible lending," it said.


© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Toxicology Tests Planned: Dead Rats Washed Up On Beaches

As many as 600 rats washed up on Westport's North Beach over the weekend to the horror of locals. DOC said they may have been killed by a recent 1080 poison drop 140km away and washed down the Buller River after heavy rain battered the coast. More>>

ALSO:

Transition To Low Carbon: Mineral And Petroleum Resource Strategy

Responsibly Delivering Value – A Minerals and Petroleum Strategy for Aotearoa New Zealand: 2019-2029 has been developed to provide the direction for the sector in the transition to a low carbon and productive, sustainable and inclusive economy. More>>

ALSO:

MethaneSAT: Methane Satellite Mission Control In New Zealand

Mission Control for an international space mission to help tackle climate change will be based in New Zealand, with the Government putting $26 million towards the state-of-the-art satellite...More>>

ALSO:

Real Estate: Late Spring Surge

The continued shortage of quality real estate listings, coupled with record low mortgage interest rates have combined to add some zing to the property market over October. More>>

Wellbeing Stats: Finances Less Terrible And Less Great

According to results from the General Social Survey, the proportion of people who felt they had enough or more than enough money to meet everyday needs increased from 51 percent in 2008 to 63 percent in 2018, Stats NZ said today. More>>

ALSO: