Move follows the acquisition of Challenger Bank
Heartland Bank has announced the rebranding of its Australian reverse mortgage business, Heartland Finance, to Heartland Bank.
The move comes after the acquisition of Challenger Bank last April, after which, Heartland’s Australian businesses, including Heartland Finance and StockCo, were transferred to Challenger Bank, which began trading as Heartland Bank on May 1.
Heartland Bank is Australia’s largest provider of reverse mortgages, holding a 42% share of the market. The bank operates as a digital specialist, offering savings products in addition to its reverse mortgages and specialist livestock finance.
“We are excited to deliver the Heartland Bank brand to our reverse mortgage customers,” said Medina Cicak (pictured above), newly appointed chief commercial officer at Heartland Bank.
“The simplified and modern new brand elements are visually appealing and provide simple navigation across our customer-facing platforms. The rebrand supports Heartland Bank’s strategy to provide finance solutions that meet the unique needs of older Australians.”
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Heartland Bank reported a 20% growth in its reverse mortgage portfolio over the financial year. Despite this growth, customers continue to borrow conservatively. The average initial reverse mortgage loan amount increased to $142,000, up from $127,000 in the previous year, with an average loan term of six years.
“We are seeing a continued trend in how our customers are using their reverse mortgage,” Cicak said. “Debt consolidation and supplementing income remain within the top three uses for a reverse mortgage, as older homeowners seek to ease cost-of-living pressures.”
Heartland Bank’s data shows that 55% of customers use reverse mortgages to upgrade their homes, 51% to consolidate debt, and 31% for additional income. Other popular uses include upgrading vehicles, covering medical costs, and funding holidays. The bank maintains conservative lending standards, with an average loan-to-value ratio (LVR) of 23.5%, up slightly from 21.5% a year earlier.
“Our customer data confirms that many customers are using their reverse mortgage to enjoy a lifestyle free from financial stress, while staying in the homes and communities they love,” Cicak said.
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