BOQ bring home loan arrears under control

Bank of Queensland appears to have gotten on top of the home loan arrears problems associated with the implementation of its new core banking system over the last 18 months. A report by Standard & Poor’s into the refinancing of $652 million of home loans through an off balance sheet vehicle, shows that BOQ’s home loan arrears peaked in late 2004. Credit ratings agency S&P said this was, “partially due to … the new core banking system, resulting in the failure of some direct debit electronic transfers.” BOQ has since fixed the problem, according to S&P, by among other things, allocating more resources to reducing arrears levels, and that, “this has resulted in arrears dropping markedly in February and March 2005, compared with recent history.”