The comprehensive report compiled by KPMG looks at 26 non-banks at a macro and comparative level, with added commentary from industry leaders, and insight into key factors facing the sector in general.  

In his introduction, John Kensington, Partner – Audit and Head of Banking and Finance at KPMG New Zealand said that the non-bank sector continues to play an incredibly important part in New Zealand’s financial and social fabric.

“These are the institutions providing over 1.7 million New Zealand businesses and individuals with access to financing that banks either won’t or can’t do as well as a non-bank entity.”

John Kensington, KPMG

First Mortgage Trust (FMT) is referenced throughout the report, with the report highlighting: 

• FMT remains one of New Zealand’s largest non-banks and in the report is ranked the fourth largest non-bank with total assets of $1.459 billion, representing an annual increase of 32%.
• FMT is continuing to grow its loan book and in 2022 reached a milestone of $1 billion in gross loans following a 34% increase over the previous year.

(Figures as at 31 March 2022)

The report also highlights the new climate and ESG (Environmental, Social & Governance) reporting requirements.

What the new ESG legislation means for FMT 

The new legislation means that non-banks with greater than $1billion in assets, which includes FMT, are now required to report on climate-related matters alongside existing financial disclosures. This means considering the impacts of climate change on future business models and activities and bringing everyone involved in the value chain into the equation.

From a market perspective, the report stresses the importance of recognising that investors, borrowers and employees are becoming more discerning and selective about whom they do business with, and who they choose to work for, with broader ESG sustainability strategies needed to increase short and long-term resilience and confidence.

FMT has just begun work on climate and ESG strategies and reporting, with an inhouse team and Board representation now in place to align activities with the new requirements to ensure we understand the impact of our operations and what we can do in the future to create a better future for New Zealanders. We will be sharing more information with our investors as we progress on this journey.

Cyber security continues to be a key focus  

The KPMG report also discussed the continued risk of a cyber-attack in a world where digital services are being expanded to complement personal service models. This is not a new topic at FMT, where the integrity of systems is vital and communications are ongoing with staff, investors and borrowers about the importance of vigilance.

At FMT we invest very heavily into technology and cyber security. We have a cyber security company providing a comprehensive security framework meaning that our systems are monitored 24/7.

Overall, the report is complimentary of non-banks, highlighting the personalised and innovative nature of the sector and the core values that define many of the businesses within it.

In this context, FMT stands tall once again, as a business providing great stewardship for investor funds and solid trusted partnership for borrowers who are working hard to create a better future for New Zealand.

Click here to read full KPMG report