A consortium involving Pepper Money is engaged in early-stage discussions with Westpac regarding the potential acquisition of the bank’s RAMS mortgage broking portfolio. 

The Australian company said it is part of a consortium negotiating with Westpac, after the media reported that it had secured exclusivity over the portfolio. 

Pepper Money said: “The negotiations are preliminary and incomplete, and no agreement has been reached in relation to the proposal. There is no certainty that an agreement will be reached or that the transaction will eventuate.” 

Westpac ceased accepting new home loan applications through RAMS in 2023, although it continued to service existing loans, according to Reuters report. 

This closure has led to a class action lawsuit from RAMS franchisees, who allege that Westpac improperly ended viable businesses and was responsible for errors in loan processing. 

The company’s current market value stands at A$961.61m ($629.15m). 

In June this year, the Australian Securities and Investments Commission (ASIC) reported that RAMS Financial Group had used payslips from non-existent employees to approve home loans. 

The Federal Court imposed an A$20m penalty on the group following these findings. 

These developments come as Australia’s credit and banking sector continues to face heightened regulatory oversight, said the publication. 

A 2019 Royal Commission report found widespread governance failings and misconduct across the country’s banking, superannuation, and financial services industries. 

In response, regulators have increased scrutiny of lending practices and compliance within the sector, the report said.