Plenti Delivers Another Record, Growing Third Quarter Loan Portfolio by 135%

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After a string of record results and after reaching his goal of a $1 billion loan portfolio, Plenti says he walks away with the leadership position among a busy field of tech lenders.

ASX-listed fintech lender Plenty Group (ASX:PLT) seems to continue to distance itself from its competitors after achieving another record quarter.

The consumer fintech lender reported record quarterly lending of more than $307 million for the third quarter of FY22, a whopping 135% above the prior corresponding period (PCP) and – again – 20% above the previous quarter.

Much to come

The company’s loan portfolio has now passed the $1 billion mark, growing to $1.1 billion as of Dec 31, 2021, 118% above PCP and 21% above Q2 FY22.

Reaching a $1 billion consumer loan portfolio was always going to be a formality for Plenti, as he assumes the leading position among fintech lenders – becoming the first to hit the milestone.

The company has previously stated its ambitions to reach $5 billion by 2025, and with a current pace of over $100 million per month, that goal is a realistic one.

“I am excited about the strong business momentum and outlook for 2022 as we deliver faster and fairer lending to our partners and customers and continue our mission to build Australia’s best lender,” said Daniel Foggo, CEO of Plenti.

Many in Q3

Record loan originations were achieved in each of the company’s three lending segments.

Once again, the auto credit segment proved to be its keystone. This segment gained 25% in the quarter to $178.6 million in new loans and was up 160% from the corresponding quarter last year.

The rapid growth in auto-lending reflects market share gains, driven by the company’s investments in technology and the continued strengthening of its sales and distribution capabilities.

A lot of time

Automotive segment growth was also supported by the rollout of its commercial auto loan offering to other broker partners, as well as the launch of its suite of electric vehicle (EV) financing products and tools in November. last.

The personal loans segment is catching up fast and grew 16% quarter-on-quarter to $101 million.

Lots of growth

According to Plenti, the continued growth of the personal loan segment reflects the strengthening demand for personal loans in general, as well as the fruits of Plenti’s multi-channel customer base.

The company has grown its active broker base to more than 200 new broker partners, leveraging its technology-driven broker offering and industry connections.

Meanwhile, Plenti’s renewable energy lending segment saw an 8% increase from the prior quarter to $28 million, despite solar and battery supply constraints during the period.

Growth in this segment was primarily driven by increased financial penetration with existing merchant partners and 50 newly accredited.

A lot of space

In this space, Plenti has also successfully executed its partnership strategy with large energy retailers, having entered into a partnership with Energy Australia and recently appointed by AGL to provide interest-free financing to its residential solar and battery customers.

Overall, the Plenti Group portfolio recorded a new monthly record of $112 million in new originations in November, with a high loan origination rate maintained in December until the seasonal slowdown of the Christmas holiday period. .

“The Plenti team delivered another exceptional quarter, delivering strong growth in every lending vertical and further demonstrating the strength of our lending capabilities,” Foggo said.

Credit performance maintained

Plenti was able to achieve its strong loan origination growth while maintaining credit quality.

Equifax’s weighted average credit score for new borrowers during the quarter was 840, above the portfolio’s weighted average score of 828 at the end of September 2021.

The company says this was made possible through its proprietary credit decisioning and pricing technology, which contains a massive amount of data derived from funding over 100,000 loans worth $2 billion since 2014.

Annualized net loan book losses for the quarter were around 50 basis points, reflecting the attributes of Plenti’s loan book and the strong underlying borrower characteristics.

The books’ 90+ day arrears also improved and were 20 basis points at the end of the quarter, compared to 26 basis points at September 30, 2021.

Solid funding

To support the rapid growth, Plenti established a second auto warehouse in December, with Westpac as lead backer and CEFC providing mezzanine financing.

This facility, which has an initial limit of $250 million, includes an electric vehicle-specific tranche, which is structured to provide highly efficient, preferential financing for electric vehicles.

“We are delighted to have secured Westpac as lead funder to support our strategic entry into the rapidly growing electric vehicle market, and we look forward to helping more Australians become electric vehicle owners,” Foggo said.

The new warehouse complements the depth and diversity of financing the company already has in place, as it strives to complete an asset based security (ABS) transaction in renewable energy and personal loans in the fourth quarter of the year. exercise 22.

The company says the ABS transaction could potentially reduce its funding costs even further, as advanced discussions with another financial partner also continue apace.

Plenti is well funded and has a strong balance sheet, with corporate cash of $29.3 million as of September 30, 2021.

This article was developed in conjunction with Plenti Group, a Stockhead advertiser at the time of publication.

This article does not constitute advice on financial products. You should consider obtaining independent advice before making any financial decisions.

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