{"id":667,"date":"2023-10-30T05:02:47","date_gmt":"2023-10-30T05:02:47","guid":{"rendered":"https:\/\/economicherald.net\/?p=667"},"modified":"2023-10-30T05:02:47","modified_gmt":"2023-10-30T05:02:47","slug":"robust-loan-book-higher-credit-quality-assets-drive-moneymes-solid-first-quarter","status":"publish","type":"post","link":"https:\/\/economicherald.net\/?p=667","title":{"rendered":"Robust loan book, higher credit quality assets drive MoneyMe\u2019s solid first quarter"},"content":{"rendered":"<p>MoneyMe reports sustainable returns for Q1 FY24 from an increasingly robust loan book<br \/>\nHigher\u2013 credit\u2013 quality assets drive a reduction in net losses, which continue to trend lower<br \/>\nMoneyMe explores application\u00a0of generative AI in customer service interactions<\/p>\n<p>\u00a0<\/p>\n<p><strong>MoneyMe has delivered a solid start to FY24 continuing its strategy of building <\/strong><strong>sustainable <\/strong><strong>profits<\/strong><strong> by reducing <\/strong><strong>credit <\/strong><strong>losses, increasing its secured assets, embracing AI, and advancing its tech for future opportunities.<\/strong><\/p>\n<p><a href=\"https:\/\/stockhead.com.au\/company\/moneyme-mme\/\" target=\"_blank\" rel=\"noopener\"><strong>MoneyMe (ASX:MME)<\/strong><\/a> has reported sustainable returns from an increasingly robust loan book\u00a0 for Q1 FY24 with the fintech saying its loan book remained stable, maintaining a healthy net interest rate margin of 11% for the quarter.<\/p>\n<p>MME\u2019s focus on higher-credit- quality borrowers and secured assets continued to improve its credit profile, with the measures positively impacting its quarterly credit loss performance.<\/p>\n<p>Consistent with its strategy to position for sustainable and profitable growth, MME intensified efforts to refine its tech platform, further optimising operations and improving operating leverage during Q1 FY24.<\/p>\n<p>\u00a0<\/p>\n<h2><strong>Solid Q1 FY24 results<\/strong><\/h2>\n<p>MME managing director and CEO Clayton Howes says MME has delivered a \u201csolid first quarter\u201d, executing on its profitable strategy by reducing losses, increasing its secured assets, and advancing its technology for future opportunities.<\/p>\n<p>\u201cOur loan book remained stable, maintaining a healthy net interest rate margin of 11% for the quarter, while our focus on higher-credit quality borrowers and secured assets continues to improve our credit profile,\u201d he says.<\/p>\n<p>Among financial highlights for the quarter:<\/p>\n<p>Gross revenue of $55m Q1 FY24, in line with Q4 FY23 ($56m)<br \/>\nStrong net interest margin of 11% in Q1 FY24, up from 10% in Q4 FY23<br \/>\nGross customer receivables of $1.1 billion, in line with Q4 FY23 ($1.1bn)<br \/>\nPrincipal originations of $130m for Q1 FY24, in line with Q4 FY23 of $127 million<br \/>\nSecured assets increased in Q1 FY24 to be 46% of the total loan book, up on Q4 FY23 (44%)<\/p>\n<p>\u00a0<\/p>\n<p>MME says delivering sustainable statutory and cash NPAT remains its focus.<\/p>\n<p>\u00a0<\/p>\n<h2><strong>Higher<\/strong> <strong>\u2013<\/strong><strong>quality credit improv<\/strong><strong>ing<\/strong> <strong>loss performance<\/strong><\/h2>\n<p>MME\u2019s strategy of targeting higher- credit- quality borrowers and increasing secured assets is also starting to pay off.<br \/>\nHowes said as anticipated, the measures positively impacted its quarterly credit loss performance.<\/p>\n<p>Net losses continued to trend lower during the quarter to &lt;4.9%, down from 5.6% in Q4 FY23.<\/p>\n<p>The average Equifax credit score was 733 in Q1 FY24, slightly up from 727 the previous quarter, while 84% of loans had a closing Equifax score of 600 or above for Q1 FY24.<\/p>\n<p>MME says 46% of its loan book is now secured, continuing its plan to incrementally increase the proportion of secured assets\u00a0 over time.<\/p>\n<p>\u00a0<\/p>\n\n<p>Source: MME<\/p>\n<p>\u00a0<\/p>\n<h2><strong>Building on business platform<\/strong><\/h2>\n<p>MME says warehouse financing renewals were executed in Q1 FY24 with its Autopay, Horizon 2020 and SocietyOne warehouses extended into CY24 as planned.<\/p>\n<p>During the quarter, the company increased operational\u00a0 efficiency through further digitisation of application journeys, including broker integrations and automation of operations processes.<\/p>\n<p>\u201cConsistent with our strategy to position MoneyMe for sustainable and profitable growth, we have intensified efforts to refine our technology platform, further optimising our operations,\u201d Howes says.<\/p>\n<p>\u201cAs a result, our operating leverage continued to grow during the quarter.\u201d<\/p>\n<p>The fintech also says it is looking at generative AI to drive further efficiencies while enhancing the customer experience.<\/p>\n<p>\u201cAs part of our technology roadmap, we are actively exploring and developing the application of generative AI in customer service interactions and various aspects of our operations,\u201d, Howes says.<\/p>\n<p>\u00a0<\/p>\n<h2><strong>Green car finance gains popularity<\/strong><\/h2>\n<p>The company <a href=\"https:\/\/stockhead.com.au\/environment-social-and-governance\/just-13-aussie-finance-providers-are-b-corp-certified-these-two-are-on-the-asx\/\" target=\"_blank\" rel=\"noopener\">achieved B Corp Certification in Q1 FY24<\/a> with a B Impact Assessment Score of 91.2, well above the 80-point certification threshold.<\/p>\n<p>Howes says achievement of B Corp certification marked a significant milestone in <a href=\"https:\/\/stockhead.com.au\/news\/the-ethical-investor-b-corp-movement-is-growing-and-heres-why-asx-listed-moneyme-wants-to-become-one\/\" target=\"_blank\" rel=\"noopener\">its commitment to ESG values.<\/a><\/p>\n<p>He says MME was also encouraged to see a steady uptick in electric vehicle (EV) loans since the launch of its discounted EV loan in June.<\/p>\n<p>\u201cThis not only aligns with our ESG focus but also reflects the growing popularity of EVs among our customers,\u201d he says.<\/p>\n<p>\u00a0<\/p>\n<p><em>This article was developed in collaboration with MoneyMe, a Stockhead advertiser at the time of publishing. <\/em><\/p>\n<p><em>This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.<\/em><\/p>\n<p><span class=\"et_bloom_bottom_trigger\"><\/span><\/p>\n<p>The post <a href=\"https:\/\/stockhead.com.au\/tech\/robust-loan-book-higher-credit-quality-assets-drive-moneymes-solid-first-quarter\/\">Robust loan book, higher credit quality assets drive MoneyMe\u2019s solid first quarter<\/a> appeared first on <a href=\"https:\/\/stockhead.com.au\/\">Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"<p>MoneyMe reports sustainable returns for Q1 FY24 from an increasingly robust loan book Higher\u2013 credit\u2013 quality assets drive a reduction in net losses, which continue <a href=\"https:\/\/economicherald.net\/?p=667\" class=\"read-more-link\">[more&#8230;]<\/a><\/p>\n","protected":false},"author":0,"featured_media":668,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-667","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - 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