Capital Group takes control of First Mortgage Trust

Capital Group finalised a deal to buy the underlying company behind FMT today, according to industry sources. The investment will see Capital Group effectively take control of running FMT, sources said. 

Capital Group confirmed the deal to TMM Online but refused to discuss further details. Capital Group Director Greig Allison said: "It is a very good business and incredibly well run. We are taking a long term view on the investment, in what we see as a growth sector."

Allison would not confirm the terms of the deal, but sources understand Capital Group has bought 100% of the company which manages the FMT mortgage lending business. FMT declined to comment, despite repeated requests.

FMT, based in Auckland and Tauranga, claims to be New Zealand's largest first mortgage non-bank lender. It, like many other alternative lenders, has enjoyed success over the past year, as more borrowers look beyond the big banks. FMT has built a loan book of more than $600 million in recent years as it grows its customer base.