Australian non-bank lender Pepper Money said that it is part of a consortium negotiating with major financial institution Westpac over the potential acquisition of the latter’s mortgage broking portfolio.
According to Reuters, Westpac shut down RAMS to new home loans in 2024 while retaining existing loans, prompting RAMS franchisees to file a class action lawsuit.
The franchisees allege that Westpac improperly terminated viable businesses and was ultimately responsible for loan processing errors.
Pepper Money said the discussions are preliminary and do not guarantee that an agreement will be reached.
The company is currently valued at A$961.61 million, following a report by the Australian Financial Review that Pepper Money had secured exclusivity over the portfolio.
In June, Australia’s corporate regulator revealed that RAMS Financial Group, a Westpac subsidiary, had used falsified payslips from non-existent employees to approve home loans.
The Federal Court later imposed a A$20 million penalty.
Australia’s credit sector has faced intense scrutiny since a 2019 Royal Commission report exposed widespread governance issues and misconduct across the banking, superannuation, and financial services industry.
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