Home loan sector too hot for Public Trust
The Public Trust has closed its mortgage books after struggling to keep up with heated competition in the residential lending sector.
The state-owned wills and estate provider has stopped accepting new home loans, instead deciding to stick to its core business.
Spokesman Brent Woodhead said the Public Trust had become well-known for estate planning over its 140-year history, but was not well-known to New Zealanders thinking about home loans.
Diversifying to offer mortgages had been a stretch, he said, especially given the highly competitive interest rate environment with incentives offered by the major banks.
Woodhead said it was too early to tell whether the loan book, which was worth $172 million as at June 30, would be kept or onsold.
However, the trust will continue to provide service to its existing customers, and any current applications in the pipeline would be processed as per normal.