Athenian empire building in progress

Athena burst onto the nonbank lending scene in 2019, promising to compete head on with Australia’s major banks in the prime mortgage market. In the following years it has built a solid foundation even amid the turmoil of COVID-19. It is now scaling up its operations and eyeing the next milestones on its path to business maturity.

At the onset of the pandemic, many assumed economic turmoil would leave early-stage businesses in a precarious position. The subsequent push from major banks to take back market share in prime mortgages – subsidised by the Reserve Bank of Australia’s term funding facility (TFF) – created an even greater obstacle for a nascent business focused on prime-mortgage lending.

Athena has not just forged on but has continued on a rapid growth trajectory. Having already built a solid base and track record of more than A$1 billion (US$741.5 million) in mortgage settlements in its first year since launch, it was able to continue scaling up its operations throughout the pandemic.

Athena surpassed A$3 billion in mortgage settlements in mid-2021 and says it has continued to see rapid growth in volume of applications. Concurrently, its arrears rates have remained ultra low throughout the pandemic. Amid the latest lockdowns in Sydney and Melbourne, Athena reports only a handful of its 6,500 customers in arrears.

Michael Starkey, co-founder and chief operating officer at Athena in Sydney, says the lender has ensured its resilience primarily by its strong capital position, conservative lending criteria and deep roots in the digital ecosystem.

Athena completed its series C funding round in late 2019 so was well set at the start of 2020. Having weathered the storm of 2020, it was able to complete a A$90 million series D funding round in May 2021. Starkey says Athena’s conservatism and the quality of mortgages it originates have made financing conversations with its existing backers relatively straightforward.

Meanwhile, the lender’s cloud-based operations allowed it to move to remote working arrangements without technological disruption.

The most important factor supporting Athena’s ability to maintain its growth trajectory in the last 18 months, however, may have been its ability to find opportunities that bring immediate scale and valuable experience.

In the last 12 months, Athena has struck new institutional partnerships in the form of lending arrangements with Newcastle Permanent Building Society and Bluestone Mortgages. Bluestone has already brought Athena-originated mortgages to the public securitisation market as part of the former’s well-received debut prime residential mortgage-backed securities deal, priced in July 2021.

Starkey says Athena derives several benefits from these arrangements: “Partnerships give us capital-free funding to support our growth. They also give us diversity in our funding mix to mitigate against system shocks such as the 2008 financial crisis and COVID-19. Additionally, participation in Bluestone’s securitisation programme helps us prepare for our own issuance.”


Athena has been building toward its own term securitisation funding since it began originating loans. The cost-efficient funding option is crucial to competing in the prime mortgage market over the long term.

The business is now closing in on this development milestone. Starkey says Athena is well supported by its existing funding partners, with a cash runway to support its growth objectives through to around 2023. Nonetheless, the group is keen to press forward with plans to execute private-placement securitisation with existing partners before the end of 2021, and a public term market debut in 2022.

Athena is not resting on its laurels with its product, either. Starkey says it is developing several innovations in its mortgage product with an eye to implementation over the short-to-medium term.

“We launched the business with a good-value, basic mortgage product and in the next six months we want to introduce a number of features for our customers. These include offset accounts, a fixed-rate product, enhancements to our payments capability and a mobile app,” explains Starkey.

He adds that Athena also intends to move into other residential mortgage-lending segments, with groundwork for this product expansion to begin in the next 6-12 months.

Athena is positioning to continue building the scale of its business in a hyper-competitive lending landscape. The impact of the TFF on prime mortgage rates may be slowly receding but Starkey expects competition to remain strong, particularly as more digital entrants, including some owned by the major banks, establish a presence.

Starkey is confident Athena can maintain its trajectory against this backdrop. “As frustrating as COVID-19 has been for everyone, it has not really affected the path of our business. We continue to grow and to innovate so we can provide a good product for our customers.”