About Metro Finance
Metro Finance was established in 2011 as a first-tier, prime Australian commercial auto and equipment lender. Metro targets high-quality SME borrowers who operate in low-volatility industries and are seeking to purchase small-ticket auto and equipment assets. This strategy had resulted in a low loss and arrears history.
Metro has recently experienced significant growth in origination volume, which it expects to continue at the current trend rate over the year ahead.
Metro originates its lending through the commercial auto and equipment broker and aggregator industry nationally. It applies an accreditation process to the selection of its originators. Metro’s network of brokers provides it with a large footprint of origination partners around Australia, though predominantly concentrated on the eastern seaboard.
Ownership and capital structure
Metro has been privately owned since inception by chief executive Phillip Crossman and the Balmain Group, a leading Australian nonbank investor and lender in the commercial property debt sector.
Metro uses a securitisation funding model. All loans are originated into warehouses and periodically termed out with ABS bond issuance to domestic and offshore debt capital market investors. The business currently has three warehouses and has completed seven ABS bond transactions, attracting investment from Australia, Europe, Asia and North America.
Metro issued its largest ABS transaction in 2021, a A$750 million deal that was well supported by domestic and offshore investors. The transaction was Metro’s first issuance that complied with risk-retention requirements for Europe and Japan, further diversifying the company’s investor base. It returned to market in February 2022 to issue a A$500 million ABS transaction that also met risk-retention compliance requirements for Europe and Japan.
|SIZE OF LOAN BOOK||A$2.5BN|
|MAKEUP OF LOAN BOOK||PRIME COMMERCIAL AUTO AND EQUIPMENT LOANS TO SME BORROWERS|
|GEOGRAPHIC DISTRIBUTION OF LOAN BOOK||AUSTRALIA: 100%|
|OUTSTANDING DEBT ISSUANCE||ABS ISSUANCE: A$2.9BN|
Metro will continue to be a regular issuer in the domestic and international markets.
Metro competes directly with the major banks in the prime commercial auto and equipment space. The company differentiates itself from competitors via a high-service model that relies on an advanced technology platform, product innovation, high-quality customer service and quick application turnaround times.
Metro’s product offering includes commercial finance agreements, finance leases and novated leasing. The business continues to focus on expanding its product offering to drive growth and diversity in its loan book. Risk in the loan portfolio is diversified across geographical regions, borrower industries and asset types.
FOR FURTHER INFORMATION PLEASE CONTACT:
+61 2 8650 4047
nonbank Yearbook 2022
KangaNews's seventh annual guide to the business and funding trends in Australia's nonbank financial-institution sector.