Commonwealth Bank and Bluestone in home loan agreement
27 January 2003
The Commonwealth Bank of Australia has signed an agreement with leading specialist lender, Bluestone Mortgages, to provide loans to customers who do not fit the Bank's usual lending criteria.
Under the agreement, customers who do not meet the criteria of Australia’s largest home lender will be referred to Bluestone for assistance.
Since launching in late 2000, Bluestone has developed a leading position in the so-called ‘non-conforming’ market, providing flexible home loans to a growing number of the estimated 2 million borrowers who fall outside normal bank criteria.
Commonwealth Bank Executive General Manager, Retail Customer Services, Nick Kennett, welcomed the agreement with Bluestone. "There are invariably some borrowers who do not meet our standard lending criteria," Mr Kennett said. "Access to Bluestone’s mortgage products now allows us to help these customers achieve their desire to own their own home.
"Our relationship with Bluestone will enable the Bank to offer our customers access to Bluestone’s product range while maintaining a core banking relationship with them."
Bluestone’s products do not generally compete with bank home loans and it is often able to lend in situations well beyond the reach of traditional products. Examples include loans to fund start-up or early stage businesses, recently self-employed borrowers, contractors and part-time workers, recent immigrants and applicants with adverse entries on their credit record.
Bluestone CEO, Alistair Jeffery, said the agreement was a boost for the company and a significant step in the development of the Australian mortgage market.
"Bluestone’s expansion over the past two years confirms the demand for specialist mortgage products," Mr Jeffery said. "We’re expecting this segment to grow to represent 4 – 6% of the total mortgage market over the next three years."
"Each loan written under this agreement will represent a customer whose specific requirements have been met," Mr Kennett said. "This results in better customer satisfaction."
Bluestone operates nationally from Sydney head office and has recently expanded its operations to New Zealand. The business is backed by a number of large financial services groups including the UK’s second largest retail bank, Barclays Bank plc, and South Africa’s First Rand.