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Heartland Bank to re-enter residential mortgages

Heartland Bank is due to re-enter the residential home loan market next year - and its strategy is a bit different to other banks.

Friday, November 25th 2016, 3:44PM

Heartland Bank chief executive Jeff Greenslade says the bank is looking to offer residential mortgages specifically through an online platform

The move is an extension of its Open for Business product which is capable of approving small business loan applications of less than $50,000 in minutes on a smart phone.

"This allows a busy business owner to apply for a loan on the way to quoting on a job."

Greenslade says it is taking the same approach to residential home loans were customers can use their smart phones and get an approval within three minutes.

"We aim to be the fastest in the market," he says.

Heartland had stayed out of the residential market as it was "way too competitive."

However, it now sees an opportunity to leverage its online platform and target a market where people want an answer quickly.

"We will be in the mix in terms of pricing," he says, but Heartland won't "target aggressive LVRs."

The offering will be online only and the bank won't use third party distribution for its home loans.

Heartland currently has a small residential mortgage book which comes from the various building societies (Southern Cross, CBS Canterbury) which came together to form the bank along with Marac Finance.

Also it had a relationship with Kiwibank but that has ended.

Greenslade says instead of using Kiwibank it will fund the loans itself. Heartland has been carrying excess capital, and had planned to return some of it to shareholders.

In his annual meeting address he said: "Many of you told us that you would prefer us to actually keep the capital. In the end, growth exceeded expectations – with $252m of receivables growth during the 2016 financial year, and a further $131m already in the first quarter of this financial year."

"This higher than expected growth came from strong demand coming through in the motor vehicle book and the Harmoney platform, faster growth in reverse mortgages (especially in Australia) and the success of new digital offerings for Business and Personal loans."

Tags: Heartland mortgages

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Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.05 ▲4.05 4.49
ANZ Special - 3.55 ▲3.55 3.99
ASB Bank 5.20 3.89 4.05 4.39
ASB Bank Special - 3.39 3.55 3.89
BNZ - Classic - 3.49 3.45 3.99
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.19 3.19 3.19
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 5.95 - - -
Credit Union Baywide ▼5.65 ▼4.75 ▼4.75 -
Credit Union North 6.45 - - -
Credit Union South ▼5.65 4.75 4.75 -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
HSBC Premier 5.24 3.54 3.54 3.69
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora 5.18 4.04 3.95 4.39
Kiwibank 5.80 4.14 4.30 4.64
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.39 3.55 3.89
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.25 4.15 -
Pepper Money Near Prime 5.64 - 5.44 5.44
Lender Flt 1yr 2yr 3yr
Pepper Money Prime 5.18 - 4.98 4.98
Pepper Money Specialist 7.59 - 7.39 7.39
Resimac 4.50 4.86 3.89 3.94
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - ▼3.39 3.45 3.89
Sovereign 5.30 4.15 4.29 4.55
Sovereign Special - 3.65 3.75 4.05
The Co-operative Bank - Owner Occ 5.15 3.49 3.59 3.89
The Co-operative Bank - Standard 5.15 3.99 4.09 4.39
TSB Bank 6.09 4.35 4.25 4.69
Lender Flt 1yr 2yr 3yr
TSB Special 5.29 3.55 3.45 3.89
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Westpac - Offset 5.34 - - -
Westpac Special - 3.39 3.45 3.99
Median 5.34 4.04 4.09 4.39

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