Market uncertainty has forced specialist lender Bluestone Group to pull back its mortgage offerings, resulting in redundancies in both the company's Australian and New Zealand operations.
"We haven't closed our Australian operations. What we have done in light of the wholesale funding market and the capital markets is we've significantly pulled back our mortgage origination platform," Bluestone Group chief executive Peter McGuinness told InvestorDaily.
Scaling back residential origination levels and suspension of commercial originations meant the company has been forced to shed staff.
Redundancies are expected to be felt primarily in sales, marketing and origination-related areas. Customer administration, servicing and special servicing, treasury, trust management, and equity release areas will not be significantly affected.operations
McGuinness would not reveal the exact number of staff losses, though he said the vast majority was in Australia with a small number in New Zealand.
"And that has unfortunately led to a resizing of the workforce that supports that particular platform because we don't have the confidence in the short-term that market is going to reopen," he said.
"Though in the long-term we are confident that it will, we're effectively going to pull back on those originations."
The downsizing will not affect the company's reverse mortgage group or its servicing and special servicing platform.
"We've got a smaller operation and its focus is now on the reverse and servicing platforms but other than we're open for business," McGuinness said.
"We think that we're doing the prudent thing and not be a reckless lender in a market that doesn't have the appetite for the product at the moment."
Bluestone Group is backed by ABN AMRO and senior management.
An ABN AMRO spokesperson said the company does not make public comment on any of its investments.
Earlier this month Macquarie Group announced it plans to scale back its Australian mortgage services. The company said the decision was because of increased costs of funding mortgages in the current financial climate.
Since 2000, Bluestone has provided more than $5 billion of home loans to over 20,000 Australians and New Zealanders.
