Macquarie to close car lending arm in drive to mortgage lending
The banking major will cut jobs at its $4.8bn car lending business after deciding to close the division to focus on its mortgage book.
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Macquarie Group will slash more than 100 jobs as it walks away from its $4.8bn car lending business, as the banking major sharpens its focus on mortgages and deposits amid mounting competition.
Staff at Macquarie’s car lending arm were informed of the move on Monday, which will take effect from Wednesday.
The boss of Macquarie’s banking arm Greg Ward weighed in to a staff online chat to reveal the “significant decision” which will end new loans from the group’s direct, broker, and novated lease channels.
Mr Ward, who has run the banking and financial services group since 2013, said the move to close the car lending arm was “consistent with our long term approach” and comes as Macquarie looks to scale its bank as a challenger to the big four incumbents.
The deputy managing director said the move was “taken after careful consideration” and would see the bank focus on “scalable digital offerings to our home loans and deposits customers”.
More than 100 members of Macquarie’s car loan originations team will lose their jobs as a result, with the bank arranging calls with staff on Monday.
Very few will be redeployed within the broader Macquarie banking business.
But Mr Ward said there would be no impact to existing car finance customers, with existing lending and novated lease customers to retain their facilities and see service “normal for the duration of their loans”.
Mr Ward also stressed there were no other changes to the products in Macquarie’s banking and financial services arm.
“Across all our channels, we see significant opportunities to continue investing to build greater scale and attract new customers,” he said.
“We’re continuing to focus on delivering the priorities outlined in our annual plans.”
Macquarie’s head of personal banking Ben Perham said the move to cut the car loan business “will enable us to further prioritise the growth of our home loan and deposit offerings”.
“Our leading digital experiences for those products are built on best-in-class technology platforms, and we see significant opportunity to continue investing in them to attract more customers to Macquarie,” he said.
The group’s banking arm has been on a tear in recent years, growing its loan and deposit books on the bank of a significant investment in tech.
At its third quarter update, Macquarie revealed it was sitting on almost $145.6bn in deposits, with a further $138.6bn in loans across the business.
However, the car loans business represented a slim slice of the bank with just $4.8bn in loans, down 8 per cent in the quarter.
Macquarie noted it is seeing a run-off in its car loan portfolio offset by a growth in the home loan and business lending arm.
The bank has dramatically scaled back its car loan business in recent years, walking away from auto dealer brokers, in a deal with Allied Credit Group, and dialling back the loan book.
Brokers have been given 48 hours to finalise any existing loan applications before cut-off.
Macquarie will join other majors which have dumped car lending.
Originally published as Macquarie to close car lending arm in drive to mortgage lending
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