Bendigo and Adelaide Bank has signalled its intention to move beyond the eastern seaboard by buying almost $1.5 billion worth of West Australian government debt.
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The bank will buy about 6,000 residential home loans from the state’s Keystart Housing Scheme Trust, a low deposit loan scheme helping people enter the property market.
Thirteen per cent of the company’s loan book is now in Western Australia.
Managing director Mike Hirst said no loans more than one month in arrears would be acquired.
“These customers have proven to be very reliable in repaying their loans and Keystart has an outstanding record of low losses compared to the broader market,” he said.
“The customers in the portfolio we are acquiring have, on average, a track record of meeting their loan repayments for more than five years.”
The purchase of the loans is scheduled to take place before the end of 2017.
Keystart was established by the WA government in 1989 and today has a loan book of about $4 billion.
Borrowers only require a two per cent deposit of the purchase price in WA's metropolitan areas and up to 10 per cent in regional areas.