SocietyOne weighs 2021 float

Lender SocietyOne has hired stockbrokers for a potential IPO, as it decides whether to pull the trigger on a listing.

SocietyOne chief executive Mark Jones.

Personal lender SocietyOne has tapped stockbrokers Morgans and Evans and Partners for a potential 2021 ASX listing, joining a string of other lending groups that are mulling a run at the local bourse.

The Australian understands the broker appointments were made ahead of the SocietyOne board making a decision over the next month or two about whether to proceed with an initial public offering.

The mooted ASX listing would help facilitate more funding to execute the company’s growth strategy.

SocietyOne declined to comment on the appointments.

It joins other non-bank lenders including Pepper Australia and Columbus Capital – which is rebranding as ColCap – that are weighing a sharemarket float in 2021. Private equity-backed Latitude Financial is also being touted as a potential IPO contender, if it can shake off the negativity from its shelved ASX listing in 2019, the second time it pulled a planned IPO in as many years.

SocietyOne has had a busy month after on Tuesday announcing a partnership with Westpac, which will see digital banking services made available to the lender’s customers in the second half of this year.

The deal further cements a relationship between the bank and SocietyOne, given Westpac’s venture capital partnership Reinventure has been an investor in the personal and peer-to-peer lender since 2014.

Besides Reinventure, it is backed by shareholders including Seven West Media, Consolidated Press Holdings, G&C Mutual Bank and News Corp, publisher of The Australian.

If SocietyOne does pull the trigger on an IPO, it will join other recent non-bank lender additions to the ASX including Liberty Financial, Plenti and Harmoney.

It’s not, though, always an easy path for non-bank lenders on listed markets.

Liberty’s stock closed at $8.20 on Thursday, well above its $6 issue price, but Plenti has disappointed IPO investors and last traded at $1.05, versus a listing price of $1.66. Harmoney’s shares closed at $2.15 on Thursday, down from an issue price of $3.50.

Pepper was listed on the ASX ahead of being taken private by KKR & Co in 2017. The private equity giant is now exploring an IPO of Pepper’s Australian operations, given risks related to COVID-19 have abated and mortgage growth has rebounded strongly.

SocietyOne – which was founded in 2012 as a peer-to-peer lender – this week confirmed growth in lending volumes had returned to pre-pandemic levels and it had topped a milestone of having originated more than $1bn in loans.

The lender, like many of its peers, has also navigated the COVID-19 turmoil well. At the height of the pandemic it had about 1000 of its 21,000 customers seeking assistance or loan repayment pauses, which has dropped to just 75 customers currently.

That aligns with the banking sector seeing a sharp reduction in loans on repayment pauses, ahead of the arrangements ceasing at the end of March.

SocietyOne is also pushing into secured and unsecured car loans as it steps up its expansion plans.

SocietyOne chief Mark Jones on Tuesday said joining with Westpac would help the lender add more products and services to its business, drawing on the bank’s scale and licence.

That tie-up followed a partnership between Westpac and Afterpay. Four months ago, Afterpay said it was teaming with Westpac to launch the buy now, pay later provider’s first savings and cash management products in Australia.