The grizzled grand-daddy of finance companies -the largest and oldest in the country- has turned 75 years old.
At the office birthday party for UDC Finance earlier this month, staff had plenty to celebrate with profit returning to pre-financial crisis levels last year and the first half of the new financial year improving on every metric again.
UDC took root in 1937, during the Great Depression. It was one of only three big deposit-takers to survive the wholesale destruction of the finance company sector, with younger companies collapsing and taking millions of Kiwi investors' dollars with them.
UDC endured and last month wrote the highest value of new lending since 2006 - beating the previous record by $2.8 million.
Loan provisions fell 29 per cent in the six months to March 2013, while lending rose 5.4 per cent. Revenue and profit -yet to be reported- both rose.
The company's resilience is built on more than good luck.
As the original 'industrial' finance firm, it is far from glamorous. It did not dabble in the speculative property developments that led others astray.
Instead, it's core business involves greasing the more mundane cogs of the economy- manufacturing equipment, plant, trucks and vans.
Chief executive Tessa Price said the company had consistently stuck to what it knew, building up decades of industry knowledge.
''It's not hard- it's trucks and cars and wheels,'' she said.
''It definitely is the customer focus and the industry specialisation that we've always had since day one...we've never steered away from that.''
Strong relationships exist with long-standing customers -on both sides of the ledger- and there was no struggle to source retail deposits.
''We have customers with us who have been investing for 55 years,'' said Price.
PwC financial services partner Sam Shuttleworth said generally, the surviving finance companies had ''stuck to their knitting''.
''They weren't chasing the dollar,'' he said. ''They had appropriate controls in place to manage their risks.''
It didn't hurt to have the backing of the largest bank in New Zealand, either.
UDC has been a wholly owned subsidiary of the ANZ since 1980. The ties remain strong- ANZ's chief executive David Hisco used to be the boss of UDC.
''A strong parent is always helpful during times of trouble,'' said Shuttleworth. It also meant the ANZ's disciplined controls and governance filtered through to UDC, he said.
Now the model has been emulated by Kiwibank. The state-owned bank launched its own UDC equivalent - Kiwi Asset Finance - as a separate company just over two years ago.
''It's part of Kiwibank providing the whole portfolio of financial services that people expect from a major bank,'' said spokesman Bruce Thompson.
Other bank competitors include the BNZ and ASB, which offer asset finance in-house.
UDC is self-funding but has a line of credit available from its parent.
It can also tap into ANZ's substantial network of business customers, giving it a big advantage for its next drive:
''At the moment we're not reaching down the small business end,'' said Price.
Existing clients are mostly larger commercial operators, but the smaller guys need a van or a truck too.
With several hundred thousand small to medium businesses in the country, there's plenty of scope for expansion.
UDC's strong balance sheet also hints at good news for the New Zealand economy.
The climate is still a bit patchy, Price said. But consumer confidence has bounced back and there's less nervousness in the commercial market.
Transport, construction and even agriculture are all tracking well.
''There's definitely more confidence there- but it's across the board,'' said Price.
- ? Fairfax NZ News
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