BNK Banking Corporation (BNK) has revealed that it is looking to break into new areas of lending and scale up its technology and product offerings through both natural growth and acquisitions.
BNK chief executive Allan Savins outlined this week that the divestment of aggregation group Finsure (to MA Financial for $151.6 million last year) had helped ensure that the group is “strongly capitalised with significant opportunities for growth”.
According to the lender, while it will continue to focus on its residential loan portfolio, it is looking to “enhance its lending book by broadening its capability into other complementary lending areas such as commercial lending and other higher margin product categories”.
“Our strategy is centred on delivering improved scalability and profitability,” Mr Savins said in an ASX update.
“We will pursue both organic and other opportunities to build the scale of the bank and leverage adjacent product categories which are higher margin to deliver enhanced profitability,” Mr Savins said, adding that this would include commercial lending, as well as deposits for small businesses.”
The lender CEO stated that the bank intends to “assess acquisition opportunities in complementary asset classes or by partnering with other organisations to deliver scale more quickly”
He continued: “Underpinning these strategic initiatives will be a step-change in our technological capability which is intended to simplify and automate our systems to provide a better experience and make it easier for our customers and brokers to do business with us.”
This includes removing manual processing, wherever possible, to reduce costs and improve processing times.
Mr Savins suggested that the bank would also seek to achieve an investment-grade credit rating to “enhance the bank’s ability to enter new markets for term deposits and develop new products”.