Irish mortgages start-up Nua to go live with initial brokers within weeks

Nua Money, a mortgages start-up backed by the Allen beef barons of Wexford, has secured a licence from the Central Bank and plans to start offering loans through an initial group of 10 brokers around the end of June, according to sources.

The company, co-founded in late 2021 by bond market veterans Fergal O’Leary and Mark Watson, is understood to be close to finalising a wholesale funding line from a major international bank. It is expected to diversify financing over time. Bert and Lance Allen, former owners of beef processor Slaney Foods in Wexford, acquired a 40 per cent stake in Nua Money last summer for €4 million.

Nua will focus on the owner-occupier market. It does not plan to lead the market on pricing. However, it is likely to pitch to brokers that the speed at which its integrated IT platform – spanning applications processing to underwriting, completions and servicing – will do business, as well as some new types of products, will give it an edge, the sources said.

Products alongside standard mortgages are expected to include loans tailored to workers from overseas who have relocated to the State, mortgages where borrowers can consolidate debt, and equity release loans, they added.

Nua, which currently has about a dozen employees, will also service its own loans, though it may ultimately outsource arrears management.

It plans to widen the list of brokers it works with during the second half of the year and start lending directly to customers within 12 months. Brokers currently account for close to half of all mortgages written in the State – up from a low of about 20 per cent following the property crash.

Representatives for Nua declined to comment on the launch plans.

Non-banking lenders have begun to re-emerge as a competitive force in the Irish market this year, having been squeezed over the previous 18 months as the price of wholesale and bond market funding spiralled as central banks hike interest rates.

Banks are able to fund the home loan books from cheap customer deposits. They are also receiving 4 per cent interest on surplus deposits placed with the Central Bank of Ireland, which is part of the Eurosystem.

Bank of Ireland, AIB and Permanent TSB accounted for 93 per cent of new mortgage lending last year.

Wholesale and market funding conditions have improved since last autumn in anticipation of rate cuts by central banks. The European Central Bank (ECB) is expected to cut its key rates next week.

Moco, another mortgages start-up entered the market with a soft launch late last year after it was acquired by Austrian bank Bawag.

ICS Mortgages, owned by a company called Dilosk, effectively withdrew from lending to owner-occupiers in late 2022 when it hiked rates and introduced the tightest loan-to-income (LTI) lending conditions in the market. It loosened the LTI limits in January to align itself with the wider market, and announced rate cuts last week.

Mr O’Leary, chief commercial officer at Nua, is best known in Dublin financial circles for co-founding bond trading firm Glas Securities to trade Irish government bonds at a time of frenetic trading of the State’s debt during the financial crisis. He also previously worked for ABN Amro, Lehman Brothers and Citigroup.

Mr Watson, Nua’s chief executive, was head of private equity-owned Maltese bank MeDirect for a decade to 2019. He previously worked for Salomon Brothers and Citigroup, serving for a period as co-head of the US banking giant’s global credit markets in London.