Latest news with #loanbook
Irish Times
10 hours ago
- Business
- Irish Times
Mortgage lending by credit unions up 34% on foot of homebuyers seeking alternatives to banks
Mortgage lending by credit unions increased by 34 per cent to €632 million in the three months to the end of March compared with the same period last year as consumers increasingly turn to finance buying a home. The Irish League of Credit Unions (ILCU), representing 90 per cent of credit unions, has published its quarterly results which show continued growth by credit unions, with further expansion in mortgage lending. Credit unions issued loans to the value of €685 million in the period, which was up 11 per cent on the previous quarter. Yet new lending in the year to the end of March was up just 0.3 per cent to €2.75 billion compared to the previous 12-month period. The total credit union loan book now stands at €6.08 billion, which is its highest point since 2008. That figure was up 2.1 per cent on the previous quarter and 9.3 per cent year-on-year. READ MORE The results show mortgage lending continues to be a growing part of the sector's loan book, increasing to €632 million, which represents a 5 per cent increase on the previous quarter and growth of 34 per cent over the previous 12 months. [ Credit union mortgages jump more than 40% by value as sector eyes new lending rules Opens in new window ] Mortgages represented 10.4 per cent of the credit union loan book at the end of the quarter, a figure that was up from 8.5 per cent on the same period a year earlier and 5.7 per cent on March 2023. ILCU chief executive David Malone said the group was 'eagerly awaiting' changes to the Central Bank's lending rules, which could see credit unions expand their mortgage loan portfolios to more than €5.5 billion from the current cap of €1.9 billion. 'This would enable credit unions to meet the growing demand from members for credit union mortgages and ultimately help more people achieve home ownership,' he said. The average loan outstanding is now at a record high of €10,617, up from €10,387 in the previous quarter. The growth in overall lending is in the context of close to record low arrears of just 2.37 per cent. 'Surpassing the €6 billion mark in our loan book for the first time since 2008 is a significant milestone and the consistent growth in mortgage lending shows that members are increasingly turning to credit unions for long-term financial needs,' said Mr Malone. As well as the growth in lending, there has been continued growth in savings, which now stand at €15.7 billion, which represents growth of 1.6 per cent in the quarter and 3.6 per cent since March 2024. There are now 3.3 million credit union members, up more than 15,000 in the quarter and 37,000 across the past 12 months. In addition, more credit union members are applying for their loans digitally, with more than half of all member loan applications originating online. Credit unions processed in excess of 8.8 million debit card payments in the three-month period, which was an increase of 10 per cent on the same period last year. Of these payments, 59 per cent were contactless. Looking at the data on an annual basis to March, debit card payments totalled 33 million, which was a 13 per cent increase. 'Credit unions now provide digital services on par with larger financial institutions,' said Mr Malone, who added they are continuing to invest in technology.
Yahoo
12-05-2025
- Business
- Yahoo
SG Finserve Ltd (BOM:539199) Q4 2025 Earnings Call Highlights: Strong AUM Growth Amidst ...
Release Date: May 09, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. SG Finserve Ltd (BOM:539199) achieved a 48% quarter-on-quarter increase in AUM, showcasing strong growth momentum. The company has expanded its anchor list to over 45 major conglomerates, including JSW, Adani, Bajaj, Tata, and Vedanta. SG Finserve Ltd (BOM:539199) maintained a healthy spread of 4% with an average yield of 12.5% and stable borrowing costs at 8.5%. The company has a clear growth trajectory with plans to increase its loan book to 4,000 crores in FY26 and 6,000 crores by FY27. SG Finserve Ltd (BOM:539199) has strengthened its funding ecosystem with 14 banks and sanction limits of about 1,500 crores. The company's total income for FY25 was slightly lower than the previous year due to a contraction in the loan book during the first half. Profit before tax remained flat compared to the previous quarter, despite significant growth in AUM. There are concerns about the company's ability to generate returns for shareholders, as highlighted by investor questions. The company faced regulatory challenges in the first half of FY25, impacting its financial performance. SG Finserve Ltd (BOM:539199) relies heavily on bank financing, which may pose risks if market conditions change. Warning! GuruFocus has detected 4 Warning Signs with BOM:539199. Q: What are the top three foreseeable and unforeseeable risks that could impact SG Finserve's business over the next 12 to 14 months, and what internal controls are in place to mitigate these risks? A: Monitoring cash flows daily is crucial. We are launching an AI-based monitoring tool to extract data from the GST portal monthly, tracking sales and purchases. This will help ensure borrowers use funds correctly and repay on time. External factors like macroeconomic changes could impact liquidity, but our short 35-day cycle helps absorb such impacts. Q: Can you explain the breakdown of fee income and other income? A: Fee income consists of processing fees. Other income includes a provision that was made in the first nine months and has been written back as it was not required. Q: What disbursement numbers are you aiming for over the next few quarters? A: We added about 750 crores per quarter in Q3 and Q4 FY25. We aim for a loan book of 4,000 crores in FY26, adding about 1,600 crores. We expect gross disbursements to increase to 3,000-3,500 crores monthly as the loan book grows. Q: Why is the profit flat compared to the last quarter despite a 50% growth in AUM? A: In Q3, we had low-cost debt from the group, which supported profits. In Q4, all debt was market debt, which affected profitability. The previous support from the promoter was not available in Q4, so the performance reflects market standards. Q: What is the long-term goal of the company for the next five years? Will SG Finserve remain in supply chain financing, or expand into other areas? A: We see a massive opportunity in supply chain funding, especially with the current gaps in financial institutions. We plan to expand downstream to distributors and retailers, leveraging data collection to enhance offerings. We aim to maintain an ROE threshold of 18% while exploring growth opportunities within the supply chain segment. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
