QUEENSLAND-BASED Breez Finance is targeting Western Australia’s fast-growing regional centres as it finalises plans to launch a new cooperative lender early next year.
A not-for-profit, mutual organisation and boutique lender, Breez also manages four cooperative lending societies, including Jacaranda Housing and the Countrywide Co-operative Housing Society.
Breez manages portfolios of loans worth more than $160 million and has revealed plans to open four Countrywide branches in WA, including at least three in regional centres.
The Countrywide business will target low to medium income earners who are unable to secure loans with the major banks but do not qualify for the state government’s Keystart Home Loans.
Countrywide has been operating on the east coast since 1960 but it hasn’t had any funding for a long time, which is why Breez has chosen to reinvigorate the society through a launch and expansion in WA.
Breez chief executive Frances Fernandez said the cooperative expected to operate on a loan-to-valuation ratio of between 85 per cent and 90 per cent for residential loans, but denied they would be high risk.
“I don’t see them as high-risk loans, they are very much the type of lending the cooperatives have done since the 1960s,” Ms Fernandez said.
“The societies have never suffered any losses or defaulted on their wholesale lending obligations so I think it goes without saying that they do a lot of responsible lending; it’s just that we look at the individual customers and the whole of what they are earning, the whole of their debt obligation.”
Breez has not finalised which WA towns it will target for its first outlets but the nine ‘super towns’ announced by Regional Development Minister Brendon Grylls in July are a key focus.
“Getting to know your customer is really important, people want to feel like they can identify with someone and if they have a problem they can pick up a phone locally,” Ms Fernandez said.
“WA is such a vast area, it’s not like they can get on the suburban train and ride into a centre and it’s unusual in the way the regions are so different.”
She said the regional focus was recognition of the key role housing played in developing and sustaining country communities.
Ms Fernandez said she believed many people in WA’s regions had difficulties securing housing finance and Countrywide could provide an option for these customers.
“I see that some of the rents are ridiculously high because of the lack of housing and that is a problem for the local mines and other businesses that need workers, they have to fly them in and out and that’s a real problem for the towns,” Ms Fernandez told WA Business News.
“We have to sustain these regional communities, they are the backbone of Australia and we’ve done it in Queensland, we need to do it in WA.”
