Bank limitations create opportunities for non-bank lenders
Winners and losers from new bank regulations Small and medium sized enterprises (SMEs) are the lifeblood of an economy, but given the changes to bank regulations the sector is increasingly a ‘loser’. In Australia, SMEs employ around 70% of the workforce and produce around 55% of business economic activity. However, two key changes continue to push SMEs out of the bank lending market: 1. Cost – under Basel III, banks must hold higher levels of capital against SME lending, including low-risk loans backed by residential or commercial property. This makes lending to SMEs more ‘expensive’ for the banks, and hence they pass the cost onto the SME borrowers. 2. Time […]
Artificial intelligence to become commonplace at instos
About 60% of Northern Trust’s Australian-based institutional investment clients believe meaningful adoption of artificial intelligence will occur within the respective businesses over the next two years. Local instos are more bullish on AI than Singapore and Hong Kong-based clients, the global custodian notes, saying the Asia Pacific counterparts anticipate adoption happening in two to five years. Half of Australian clients surveyed also noted high-level stakeholder engagement and counter-party co-operation as vital to financial services’ adoption of blockchain. The findings come from surveys conducted at Northern Trust client events in the first quarter of 2018. Northern Trust head of market advocacy and innovation research, Asia Pacific, Danielle Henderson said as the […]
Prospa float reveals a new world of online business financing
Online small business lender Prospa is set to hit the ASX on June 6 with a market capitalisation of $576 million. It’s a lofty valuation for a relatively new business lender with a net loan book of $200 million and a statutory net profit in the 2017 financial year of just $1.2 million. But the number – settled after an institutional book build for Prospa shares last Thursday – points to the aggressive growth aspirations for the Sydney-based group, which is raising $146 million in an initial public offering fully-underwritten by Macquarie Capital and UBS. In its prospectus filed with the corporate regulator on Monday morning, Prospa said it expects to originate […]
Wisr appoints Chief Operating Officer
Australian neo-lender Wisr Limited (ASX: WZR) today announced the appointment of Mathew Lu as Chief Operating Officer. Mr Lu has deep experience in the Australian unsecured consumer finance industry with 18 years experience in senior financial services and payment technology roles, including most recently with the Commonwealth Bank where he was Executive Manager for Retail and Commercial Credit Cards. In his new role at Wisr, Mathew will be responsible for operations across the business with a particular focus on the execution of innovation through technology, managing the end-to-end customer journey, and delivering on the company vision of bringing financial wellness to everyday Australians. Anthony Nantes, Chief Executive Officer Wisr said […]
Advice documents still not clear, concise and effective
Many clients are simply not understanding the advice being presented in Statement of Advice (SoA) documents, because they are still not clear, concise and effective, according to leading fintech, YTML. Over the past three years YTML, which provides a number of advice technology solutions, including a paraplanning service, has seen over 50 different SoA templates. “Over 80 per cent of these were over 40 pages long,” said Terri Ho, YTML’s GM of Advice. “The longest I have seen is 130 pages.” Ms Ho said the advice in many SoA documents isn’t being presented in a succinct way to clients – the information lacks clarity, there is too much jargon […]
Pensioners prime market for robo-advice
There is considerable opportunity to provide robo-advice to pensioners seeking affordable, accessible and personalised advice, according to GlobalData. The company’s 2017 Life & UK Pensions Survey found that 63 per cent of individuals accessing financial advice used it to discuss pensions, which usually was through visiting online platforms that provided automated advice. GlobalData pointed to the cheaper fees and ability to engage with services more frequently through robo-advice as key to its appeal to pensioners. Insurance analyst for GlobalData, Danielle Cripps, said that pension providers should look to robo-advice to offer assistance on not just saving for retirement, but also helping people at and in retirement. To read more, […]
myprosperity and View Legal partner to offer automated estate planning services
myprosperity, Australia’s leading personal wealth portal, is partnering with Australian estate planning firm, View Legal to provide free, standard wills. A personal wealth portal, myprosperity is a white-label desktop and mobile app that advisers and accountants can enable for their clients. The platform provides a consolidated, real-time view of a client’s entire financial world, thanks to live integrations with leading financial services providers. When enabled by an adviser, myprosperity’s estate planning functionality will allow a client to generate a standard View Legal will and automatically populate the relevant data from their personal wealth portal, including all their assets and liabilities. This legally binding will is then stored on myprosperity, delivering […]
Prospa books open, offer size reduced
Macquarie and UBS’s equities desks have started beating the drum for ASX-aspirant Prospa. The brokers opened Prospa’s IPO bookbuild on Thursday morning, with news the offer size had been reduced. Some of the online small business lender’s existing shareholders have cut the size of their selldown. Prospa is now seeking to raise $141 million to $147 million, according to terms sent to fund managers. The first $100 million is pegged for the company while $41 million to $47 million represents the shareholder selldown. It had initially been targeting up to $60 million for the selldown. The price was retained at $3.04 to $3.83 a share, as was the targeted market capitalisation […]
