UDC Finance is New Zealand’s largest nonbank lender. It has a proud history of supporting the country’s productive sector for more than 80 years, as well as being the dominant finance partner for major brands and franchise dealer groups in the automotive-finance industry. UDC focuses on providing asset-based secured finance for vehicles, equipment, plant and machinery to a wide range of New Zealand businesses including transport, forestry, agriculture, construction and manufacturing, as well as to consumers.
UDC has a history of profitable growth and leading market share, achieved by helping its customers grow and prosper. A major part of this success is an established network of finance specialists throughout the country, whose invaluable industry knowledge has helped build successful relationships over many years.
Ownership and capital structure
UDC began life in 1937 as Financial Services Limited and by 1980 was a wholly owned subsidiary of ANZ Bank New Zealand. In September 2020, UDC was sold to Shinsei Bank of Japan, a diversified financial group that operates asset financing as well as vehicle and consumer lending businesses in Japan and offshore. UDC is strongly capitalised and Shinsei Bank intends to take a long-term, supportive approach to growing UDC.
|SIZE OF LOAN BOOK||NZ$3.4BN|
|MAKEUP OF LOAN BOOK||CONSUMER AUTO LOANS, SME EQUIPMENT LOANS, FLOORPLAN FACILITIES|
|GEOGRAPHIC DISTRIBUTION OF LOAN BOOK||NEW ZEALAND: 100%|
|OUTSTANDIND DEBT ISUANCE||SECURITISED WAREHOUSE FACILITIES: NZ$2BN
PARENT FACILITIES: NZ$790M
BANK FACILITY: NZ$50M
UDC’s funding is provided by a mix of shareholder equity, parental funding, structured bank funding and a bank facility.
In conjunction with the sale to Shinsei Bank, UDC established two triple-A rated warehouse facilities for the funding of secured auto and equipment loans of NZ$2.1 billion in total. This landmark transaction created New Zealand’s largest nonbank syndicated securitisation programme.
UDC intends to be a regular issuer of ABS from its warehouse facilities to complement its existing funding arrangements and diversify its investor base across New Zealand and Australia. It recently completed its debut auto-backed ABS issue, for NZ$400 million.
UDC’s nationwide and well-diversified asset portfolio across industry sectors has contributed to strong and stable performance for an extended period.
In response to COVID-19, UDC proactively provided relief packages so customers could manage the financial impact of the pandemic. The number of customers seeking financial relief is now lower than pre-COVID-19 levels, reflecting in part the resilience of the New Zealand economy.
UDC has seen strong momentum in new lending during 2021 across all its core product offerings as the postCOVID-19 recovery continues. This reflects high levels of business and consumer confidence as well as strong economic activity. This growth has been achieved despite disruption to global supply chains affecting many of the industries UDC is associated with.
UDC’s highlights over the last 12 months include a 0.1% 60+ days arrears rate, achieving around 80,000 active customers and completing NZ$1.6 billion in transaction volume.
FOR FURTHER INFORMATION PLEASE CONTACT:
Mark De Ree
Head of Treasury
+64 9 952 7146
Chief Financial Officer
+64 9 952 7233
nonbank Yearbook 2021
KangaNews's sixth annual guide to the business and funding trends in Australia's nonbank financial-institution sector.