Another Lender drops out of development loans

Last month, Suncorp-Metway Ltd dropped out of the commercial and development lending sector.
Booooohoooooo...They were one of my favourite sources of funding development sites in the $2m to $10m range.

The decision was made as a result of funding pressures, including its reliance on wholesale funding which it said has made the business uneconomic.

With its lower rating than the other major banks like NAB, CBA, ANZ, Westpac,
Suncorp is finding it tough to buy the money and lend it out with a healthy margin.

Suncorp will now focus on its retail banking business (home loans etc) with intentions to source up to 60% to 70% of its funding requirements from its retail deposit base.
Source: Mortgage Business Issue 3.5