Mortgage Professional Australia issue 15.04 by Key Media

DIVERSIFICATION LEARN FROM THE MASTERS

MPAMAGAZINE.COM.AU ISSUE 15.4

CHALLENGER AGGREGATORS A DIFFERENT WAY OF DOING THINGS RATE CHANGES ADVICE FOR THE YEAR OF UNCERTAINTY

MPA EXCLUSIVE

NON-MAJOR BANK

ROUNDTABLE RETURNS!

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CONTENTS

twitter.com/MPA_Australia www.facebook.com/ MortgageProfessionalAU

NEWS

4 | News and tips Intelligence and tips for the cutting-edge mortgage professional

62 | Financial results What half-year results can tell you about the industry FEATURE

DIVERSIFICATION Keep customers coming back to you

BUSINESS STRATEGY

52 | Customer service Why it’s worth putting in that little bit extra

56 | Recruitment How to ‘onboard’ a new hire

MORTGAGE INSIDERS 61 | Day in the life

COVER STORY

Cutting calories with Genworth’s Bridget Sakr

NON-MAJOR BANK ROUNDTABLE

Our industry-leading roundtable is back, and tougher than ever

FEATURE

MORTGAGE INSIDERS

A diﬀerent way of doing things

CHALLENGER AGGREGATORS

64 | Favourite things Join Finsure chief John Kolenda for a casual game of water polo

HUW BOUGH

14 MyState’s head of sales on the regional bank’s rapid rise

MPAMAGAZINE.COM.AU NOW ONLINE: A different business strategy focus each week Brokers on Banks survey NEW MPA rankings pages

NEWS

MPA TV: Major bank roundtable videos and much more

Keeping calm in a year of rate uncertainty

… and tips and highlights from the latest magazine

NEWS ANALYSIS

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FEATURE / BROKER EDUCATION

EDITORIAL

MPAMAGAZINE.COM.AU

Contact the editor: sam.richardson@keymedia.com.au

The year of living dangerously P

redicting anything is a dangerous thing in a monthly magazine. When the MPA team began writing this issue, the industry was in shock at the news that the RBA had cut the cash rate to 2.25%, a bold move unexpected by most experts. By the time this magazine hits your desks the rate could have fallen further still. After 18 months of stability, clients will be looking for reassurance and guidance – not to mention the eternal question of fixed vs variable – and we’ve tried to fill this issue with strategy advice that’ll work for the long term, rather than the speculation typical of many. We’ve also included features on challenger aggregators and diversification, because whatever the RBA is doing, the modern broker needs to look beyond rate. What the RBA’s decision says about the Australian economy is also interesting. It’s an admission that the housing industry is clearly leading the game, and that the Sydney and Melbourne markets perhaps aren’t as overheated as critics claim. That said, brokers should be as concerned about unemployment and historically low consumer sentiment as anybody else. At the very least, the rate cut can make people think about money – making it more important than ever to reinforce the strength of the broker proposition.

Sam Richardson, editor, MPA

COPY & FEATURES

EDITOR Sam Richardson JOURNALIST Maya Breen PRODUCTION EDITORS Roslyn Meredith, Moira Daniels, Carolin Wun CONTRIBUTORS Karen Evans, Stefan Kazakis

ART & PRODUCTION

GRAPHIC DESIGNER Loiza Caguiat, Kat Vargas, Lea Valenzuela DESIGN MANAGER Daniel Williams

SALES & MARKETING

NATIONAL SALES MANAGER Rajan Khatak ACCOUNT MANAGER Simon Kerslake MARKETING & COMMUNICATIONS MANAGER Lisa Narroway TRAFFIC COORDINATOR Lou Gonzales

CORPORATE

CHIEF EXECUTIVE OFFICER Mike Shipley CHIEF OPERATING OFFICER George Walmsley MANAGING DIRECTOR Justin Kennedy ASSOCIATE PUBLISHER Rajan Khatak CHIEF INFORMATION OFFICER Colin Chan HUMAN RESOURCES MANAGER Julia Bookallil Editorial enquiries Sam Richardson +61 2 8437 4787 sam.richardson@keymedia.com.au Advertising enquiries Sales Manager Rajan Khatak tel: +61 2 8437 4772 rajan.khatak@keymedia.com.au Account Manager Simon Kerslake tel: +61 2 8437 4786 simon.kerslake@keymedia.com.au Subscriptions tel: +61 2 8011 4992 • fax: +61 2 9439 4599 subscriptions@keymedia.com.au Key Media keymedia.com.au Key Media Pty Ltd, regional head office, Level 10, 1–9 Chandos St, St Leonards, NSW 2065, Australia tel: +61 2 8437 4700 • fax: +61 2 9439 4599 Offices in Sydney, Auckland, Denver, Toronto, Manila mpamagazine.com.au Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as MPA magazine can accept no responsibility for loss.

^Not Zeala

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ROUND-UP

NEWS AND TIPS

The shopfront is dead; long live the shopfront The leading franchise brokerages explain why shopfronts remain a crucial marketing tool in the digital age SHOPFRONTS TEND to have a hard time in this magazine. With the rise of online channels and the general emphasis of elite brokers on referrals and database marketing, no one wants to talk about walk-in clients anymore. If bank branches are failing, logic says ‘why not brokers’ shopfronts?’ The heads of Australia’s three main franchise brokerages confronted this question at the recent Australian Mortgage Innovation Summit, with interesting results. For a start, outgoing Mortgage Choice CEO Michael

Russell insisted, it’s not about walk-ins. “They’re not looking for the spontaneous homebuyer who’s out looking for bread and milk… they send a message that they’re the owner of the business and hope to remain front of mind for when that homebuyer or mortgage holder want to transact.” This “long-term play”, as Russell puts it, was also pointed to by Aussie’s James Symond when describing Aussie’s shift from mobile-only to multiple channel broking. “For us, it’s about community; it’s about that 24/7 billboard and awareness, giving the customer the confidence that the brand and the people will be there next month and next year.” Symond also repeated an earlier comment by Yellow Brick Road CEO Matt

Lawler: that brokers’ values stem from being in the job for the long term, rather than constantly switching roles as is commonplace in banks. Having a shopfront and evident personal investment in that shopfront, he argued, helps reinforce consumer confidence and trust. Still not convinced? For the hard-headed out there, Lawler spelt out the shopfront’s appeal in dollar terms: “The way we think about shopfronts is when you’re investing in your brand, when you’re letting people know who you are and what you do, you can’t maximise the return on that spend in marketing dollars if you don’t have retail shopfronts.” The shopfront can ‘trigger’ the consumer to take action, even long after exposure to marketing, he noted.

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ROUND-UP

NEWS AND TIPS

Meet the pre-customer Leads are so 2014 – you’ve got to think about customers long before they fill out your online enquiry form 2015 IS increasingly looking like the year of the ‘end-to-end customer experience’. Or at least that was the message at the Australian Mortgage Innovation Summit, where the focus was on using digital to make seamless, stress-free applications, whether through electronic signatures or intuitive websites. Perhaps the most interesting discussion concerned how you actually define who is a customer, and when someone actually becomes a customer. In digital terms, a pre-customer is a visitor to your website, who has yet to identify themself. Sky News Business presenter Heidi Armstrong raised the term as part of the summit’s ‘innovators’ panel, which included Connective principal Mark Haron, Firstmac’s Kim Cannon, Vow/Yellow Brick Road group funding CEO Andrew Zanchetta and Liberty Financial’s technology manager Jason Serafino. Serafino, whose background is in digital, dubbed the rise of the pre-customer a “profound change that is occurring in the digital space… there is some really rich data available about the decisions customers are making. You really do need to start tracking from that moment, and as they go through the lifecycle of becoming a lead, you’re adding to that information.” Already software can tell you which sites

customers are coming from, whether it be search engines or social network referrals, and work out their geographic location through their IP address. It’s these sources that YBR is concentrating on with their digital strategy, noted group funding CEO Zanchetta, as they look to maximise conversion rates by refining the online experience to suit their pre-customers. Connective chief Haron connected the pre-customer concept to the well-known strategy of ‘funnel marketing’. The theory posits that although only a smaller number of customers make it to the narrow end of the funnel (a completed deal), having a large number at the entry stage will filter through to qualified leads and eventually satisfied clients. Connective can and does track potential broker customers on its website. He added: “The moment they’re a prospect, they’re a customer as far as we’re concerned; they’re in the funnel.” Brokerages have begun actively tracking the pre-customer, explained Haron. “We’ve got two broking businesses using these services, and they’ve been exceptional at using search engine optimisation and using the internet to enable them not only, when someone visits their site, to gather information and track the customers, but in terms of their marketing activities to ask

what sort of customer do we want this week; not this year, but this week.” Although the technology is there, as a business concept the pre-customer is still in its infancy, he conceded. “It’s tricky because [the software] is expensive. It’s up to aggregators like us to start building that capability, to say ok, it’s hard for you as individual broking businesses to do that, so we’ll build it and then carry you into the future on the back of that.”

FUNNEL MARKETING

PRE-CUSTOMER AWARENESS OPINION

Woopra Favourably mentioned by Firstmac’s Kim Cannon, this paid-for service enables real-time analytics and even creates individual customer ‘profiles’ where you can see how pre-customers interacted with your site.

PREFERENCE PURCHASE

Adobe Analytics Amongst the most advanced systems and thus correspondingly expensive, it includes Adobe Target, which allows you to create personalised customer experiences in real time, enabling you to interact with the pre-customer.

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CONSIDERATION

PRE-CUSTOMER SOFTWARE TOOLS

Google Analytics This is a free service that allows you to track where website visitors are coming from, and how they interact with your website, including in real time. It’s best for analysing visitors as a group, rather than individuals.

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Do you just cross your fingers and hope they’ll be alright..? Wealth Today Managing Director, Greg Pennells asserts that just getting your client a mortgage is no longer enough.

“People generally have their car, home and health insurances organised. But over and over we meet clients with nothing in place to protect them from financial risk,” said Pennells. “A client’s mortgage is usually their greatest financial commitment and it’s just not acceptable to set them up with that debt without ensuring they are protected from financial risk,” Pennells said. “In fact, I challenge any broker not to recognise and fulfil their moral obligation to ensure that at least that very basic level of their clients’ financial security is protected.” Leanne Clune is a busy mortgage broker based in the Perth Hills. She introduced financial services to her business more than three years ago and has strong views on client care. “Clients walk into my office looking for a home loan but when they leave, they have their home loan as well as appropriate safety nets in place and they’re on track for retirement planning,” said Clune. Gold Coast mortgage broker, Chris Lee has been providing his mortgage clients with financial advice for four years and has had direct experience with clients suddenly unable to make mortgage repayments. “First home buyer clients, Henry and Anna had to make an Income Protection claim after Henry did his knee playing Oztag and needed a full reconstruction. He was in a manual job and couldn’t work. If I hadn’t organized their Income Protection, they’d have been forced onto

one income that wasn’t enough to pay the mortgage. They’d have lost their home,” Lee recalls. “This was a classic could-happento-anyone situation and a financial safety net is the bare minimum I offer to arrange for my mortgage clients. It makes sense and gives us all peace of mind.”

“

I challenge any broker not to recognise and fulfil their moral obligation to ensure that at least that very basic level of their clients’ financial security is protected. Greg Pennells

“

ealth Today Managing Director and co-founder of Choice Aggregation Services, Greg Pennells, speaks out on the responsibilities and duty of care of Mortgage Brokers.

So aside from ensuring clients are covered, what would introducing financial services do for a mortgage broking business? “We’ve just been talking about basic insurance and risk here, which is super simple and a great way to increase the value of each client,” said Pennells. “But brokers who offer full financial advice are seeing tremendous increases in their earnings and significant increases in the value of the business as an asset,” Pennells said.

“Wealth Today has been instrumental in helping me build my business from a single operator to staff with an office. The support from WT is amazing. I have worked for two other financial Leanne Clune planner dealer groups with little or no support. I know I have aligned myself with the right group for my business now and I highly recommend Wealth Today to other brokers.”

Don’t think it will never happen to your clients... Each year, around 55,000 Australians suffer a heart attack. ‘Data and Statistics’, Heart Foundation, 2012

Over 39,000 people will be hospitalised due to injury or poisoning in a year. ‘Australia’s Health 2010’, Australian Institute of Health and Welfare 2008

Research has shown that 58% of working Australians could survive less than three months without their income before needing to sell assets. Zurich Misinsurance whitepaper February 2014 Wealth Today Australian Financial Services Licence No 340289

“What Wealth Today can do for a mortgage broking business is quite incredible. It’s what the company was created to do. We’ve made it so simple, completely flexible and we are committed to supporting every Member to success,” he said.

Chris Lee

“I’m absolutely certain that I made the right decision to join Wealth Today. I look back now and don’t know what I would be doing if I wasn’t involved with WT. I can turn a $1,500 client into a $4,500 client and when I do that a couple of times a month, it’s more than worthwhile.”

wealthtoday 1300 364 699 wealthtoday.com.au

Financial Planning Integration

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ROUND-UP

NEWS AND TIPS

E-conveyancing explained The PEXA system is being rolled out across Australia this year, and its CEO claimed it will produce an ‘unexpected windfall for the broking industry’ ALREADY IN NSW and Victoria, and in Queensland and WA by May, e-conveyancing is going to drastically change the homebuying process – a change on par with e-lodgement and cloud-based CRMs. It’s directly relevant to mortgage brokers, insisted CEO Marcus Price, talking to MPA; “PEXA is going to make their transactions safer, faster and more efficient – that’s the bottom line.” PEXA is an online workspace – Price compared it to a private Facebook page – where conveyancers, banks and, crucially,

state land registries interact, without ever having to call each other or post a document. Digital interaction means transparent interaction. Price said: “We can show people complete visibility of what’s going on, which will be critical for mortgage brokers so they can see what’s going on with all of their settlements at any point in time.” Brokers will be given the tools to track the entire e-conveyancing process from the comfort of their desks, Price claimed, without having to be PEXA subscribers. So. how does e-conveyancing actually work?

REVOLUTIONISING REFINANCING Refinancing will be transformed by e-conveyancing, claimed PEXA CEO Marcus Price. “In the longer term, we can see a couple of things happening which will be in the brokers’ interests. We see electronic mortgages becoming popular, and with e-conveyancing that means you can do refinancing very easily and efficiently and simply… refinance will become a much higher velocity product and make it much easier for people to shift providers.” PEXA already allows refinancing, providing both banks are PEXA subscribers.

HOW PEXA WORKS

Buyer’s solicitor/conveyancer sets up an online ‘workspace’

All forms are created and signed by all parties online

All participants must be subscribers – the 16 banks are signed up, but many conveyancers are yet to join; “that’s one of the issues of the early adoption phase,” admitted Price

Subscribers must be accredited with PEXA, a legal requirement. Price explained, “there are already 800 in the process”

3 At settlement time PEXA executes the transactions, lodges forms with Land Registry

4 Brokers will be able to track progress and know who is responsible for delays

PEXA triggers RBA to release funds, which arrive in accounts in seconds

5 Participants emailed/sent SMS message upon completion

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FEATURE / BROKER EDUCATION NEWS ANALYSIS

RATE UNCERTAINTY

RBA RATE CUTS: KEEP CALM AND CARRY ON Few expected the RBA to cut its cash rate in February, but it’s possible it will fall further still. With so much speculation and anxiety, what can brokers expect for the coming year, and how can they keep new and existing customers satisfied? Sam Richardson investigates

18 MONTHS is a very long time in the industry, and quite long enough for economists, consumers and brokers to get comfortable with the RBA’s 2.50% cash rate. Even those who did expect the rate to change tended to look the wrong way – this magazine included – by speculating when, not if, the cash rate might rise. In fact, just two of the 30 economists and experts surveyed by mortgage comparison site Finder expected February’s rate cut to 2.25%. In a year when the experts seem more wrong than right, how can you reassure clients and keep them, and yourself, in the know? Let the good times roll Of course you know that, for mortgage holders, a rate cut is a good thing – it leaves more money in their pockets. But is it a good thing for brokers? Jeff Chapman, national product and marketing manager for LJ Hooker Home Loans, is cautious: “We really feel in a broker market, a better market is a rising market.” When rates rise, he explained, “people need solutions; they need cash flow guidance”. Conversely, those with falling variable rates are having the work done for them. Glenn Stevens and his team want the rate cut to raise confidence and drive economic recovery; a recovery which brokers can capitalise on. Talking to Ben Eick, LJ Hooker broker for NSW’s Hunter region, it sounds like the rate cut is doing the job. Formerly a classic example of a struggling ex-mining

region, the Hunter is now buoyant: “It’s really made people shop around a lot more now, look for those really good fixed rates; they’re so low it’s ridiculous!” Nearby Sydney and its booming property market was previously held up as the main reason against a rate rise. So, what’s changed? Explaining February’s change in direction,

Glenn Stevens told the Senate Economics Committee that “developments in the Sydney market remain concerning, but in the end we did not see these trends as overwhelming a case for a further easing in monetary policy”. MPA asked Joel Wyld, Oxygen Home Loans broker based in Sydney’s affluent Eastern Suburbs, how the rate change was impacting

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business. “[The rate cut is causing] another surge in the property market,” admits Wyld. “The knee-jerk reaction by the market when rates go down is that property prices tend to rise quite sharply; the problem is it’s not our clients that are purchasing these properties – it’s still these overseas buyers.” Wealth investors from China can buy in cash and easily outbid Wyld’s clients at auction. Nevertheless he’s “still very confident” about the year ahead. For both brokers, the rate cut has particularly helped investors, who were previously struggling in an environment of stagnant or even declining rental yields. Here it seems the rate cut could be driving a rational shift away from the more overheated markets, Wyld’s experience suggests: “A lot of my investors were already looking interstate or are starting to look interstate now. The Sydney market is pushing a lot of people out… With rates going down it’s a great thing because the rental yield is strong and any drop in rate improves their positive gearing.” Finally, interest in refinancing has unsurprisingly increased since the rate cut. Talking at the publication of Mortgage Choice’s half-year results, CEO Michael Russell noted the rate cut “has certainly stimulated an increase in refinance enquiries at Mortgage Choice… our customers can take advantage not just of low interest rates, but [also] the fierce competition that’s happening with our lender panel”. However, the possibility of further cuts can make potential refinancers hesitant, Wyld cautions: “When rates go down, in my experience, it makes people more cautious than anything else; when rates go down, people say ‘oh, I don’t want to refinance just now, I’ll wait until the dust settles’… rate rises and falls make people think a bit more.”

It’s the economy, stupid Overcoming client hesitancy, while continuing to recommend clients the right product, will be brokers’ main challenge for 2015 it seems. ING treasurer Michael Witts described the rate cut as a “double-edged sword… Your mortgage repayments are coming down. But as a double edged sword, consumers will be asking ‘what does the RBA

SOURCES OF USEFUL INFORMATION Labour market data – the Australian Bureau of Statistics publishes monthly reports on its website, and the RBA makes a comment in its board meetings, the minutes of which can also be found online. Auction clearance rates – Corelogic RP Data publishes a weekly indicator of rates on Thursdays, parts of which can be found in the industry and financial press, including MPA’s sister title Australian Broker. Expert opinions – mortgage comparison site Finder.com.au surveys 37 experts in advance of the RBA’s monthly meetings to get their predictions on any rate changes – although most of these failed to predict February’s rate cut.

Stevens told the House of Representatives economics committee: “The Board considered that this revised assessment – that is, sub-trend growth for longer, a higher peak in the unemployment rate, slightly lower inflation – warranted consideration of some further adjustment to monetary policy.” Connected to unemployment is wages and, at the time of writing, the Australian Bureau of Statistics (ABS) reported that wage growth was at its lowest level for 17 years. Commonwealth Bank’s chief economist Michael Blythe, when questioned by MPA during the Australian Mortgage Innovation Summit, indicated that rising unemployment could force the RBA to further drop rates. “Forecasts implied a peak in the unemployment rate at 6.4%... clearly we’re going to achieve those forecasts by the end of this year and it must be feeding into their worries and it’s something they look at closely when they think about interest rates.” A secondary measure to keep track of, ING’s Witts noted, is week-by-week auction

“There will be a point where a further reduction won’t stimulate buyer demand; it’ll probably continue to stimulate refinance demand… we have to be getting close to that point now” know that we don’t know?” Together with Witts and a number of other economic experts, MPA has set out to answer that very question – or at least provide you with the tools to make your own judgement. When the RBA wants to judge the state of the Australian economy, it focuses on one measure in particular: the unemployment rate. “Labour market data undoubtedly is one of the key elements that the Reserve Bank focuses on, whether it’s vacancies or the actual data,” Witts told MPA, pointing out that the RBA always comments on unemployment in its monetary statements. What concerns the RBA is that the level of unemployment is not budging, as Glenn

clearance rates. “[They’re] a very good litmus test of what’s going on in the market.” These will be familiar to brokers, and the RBA will also be looking at them to see whether low rates are driving Sydney and Melbourne’s overheated markets to dangerous levels, or simply causing sustainable growth nationwide. The most recent data at the time of writing was RP Data Corelogic’s February Home Value Index, and while prices had increased modestly, auction clearance rates had surged. Auction clearance rates ranged from 82.6% in Sydney to 40% in Perth with an average of 77% – the highest level since 2009. The surge even came as a surprise to Corelogic’s head of research Tim Lawless, he told MPA. “I’m

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FEATURE / BROKER EDUCATION NEWS ANALYSIS

RATE UNCERTAINTY

Jeff Chapman, national product & marketing manager, LJ Hooker

Michael Witts, treasurer, ING bank Australia

quite surprised at the surge in auction clearance rates; I didn’t expect the cut in rates to provide as much stimulus as, anecdotally, it seems to have had.” GDP figures are Witts’ third measure that brokers should keep an eye on. In June the ABS will publish Australia’s GDP figures for the March quarter. As GDP is a traditional indicator of economic growth, commentators will be looking at the data for the results of the RBA rate cut. As Witts puts it, “the test of the Reserve Bank’s view will be seen in the March quarter GDP data”.

The limits of prediction There are other measures which also matter – equities markets, consumer sentiment and exchange rates being the most prominent. However, although informed prediction can be useful up to a point, it’s worth noting that simply changing the cash rate won’t cause an automatic change in the economy – a fact which is increasingly concerning experts. HSBC chief economist Paul Bloxham, speaking at the Australian Mortgage Innovation Summit, warned that “the RBA is right at the edge of monetary policy”. Governor Stevens’ speech to the Senate lamented that the effect of further reducing interest rates could be “less than it was in the past”, although it still had some effect. Mortgage Choice CEO Russell took a similar, if more reserved view: “There will be a point where a further reduction won’t stimulate buyer demand; it’ll probably continue to stimulate refinance demand… we have to be getting close to that point now.”

Ben Eick, principal, LJ Hooker Hunter Office

“Brokers have to get better at segmenting and analysing their database… who’s rolling off fixed rates? Not this week, but in three months’ time, because that customer is probably starting to look now” Even when RBA policy is effective, it’s important to note the significant gap between cause and effect, insists ING’s Witts. Changes in the interest rate take months to create economic changes, and with wider timeframes come other factors to consider, he adds. “What’s happening in late 2015-16 is the export phase of the resource investment boom; all that money that’s gone into mining and railway equipment and so on means we’ll be able to export more iron ore and in particular liquefied natural gas… what the Reserve Bank’s got to do is balance the domestic market, the consumers market, against what’s happening in the export sector.” As ever, international conditions beyond the RBA’s control can impact the Australian economy, and may constitute yet another

Joel Wyld, mortgage broker, Oxygen Home Loans

measure to keep an eye on. One of the major reasons for the RBA cutting the rate in February was that a number of other central banks had already done so; official rates are technically negative in Europe, for example. As these economies start to recover, with the US being the most likely to do so, they may consider raising rates and the RBA will have to follow them.

Broking in uncertain times Clearly, you’re not helpless when it comes to advising your customers what the economy is doing. However, the rate cut calls for a more extensive change in approach, beyond just keeping up with the news. We went back to our brokers and experts to ask what they’re doing to drum up business in the year of uncertainty. First and foremost, these brokers were going back to the database. “We’re really working hard at the moment to contact all of our customers and offer them the best rate,” explained LJ Hooker broker Eick. “It’s so competitive that if we don’t offer the best rate they will go somewhere else.” His view is reflected by marketing chief Chapman at head office: “Brokers have to get better at segmenting and analysing their database… who is rolling off fixed rates? Not this week, but in three months’ time, because that customer is probably starting to look now, they’re thinking fixed or variable, the banks are starting to look at that customer, to see if the broker’s going to do something.” “Don’t just say ‘do you want a home loan health check?’ ” Chapman adds. “That’s what everyone’s doing. Say ‘I know you as a

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“The RBA is right at the edge of monetary policy” customer, would you be interested in talking about this?’ ” Database marketing has been consistently advocated by leading brokerages and aggregators in MPA, in part due to its importance in brokerage diversification; you can offer clients personal, commercial and equipment finance when they’re most likely to need these services. For those brokerages that are already diversified, the rate cut provides interesting opportunities for cross-selling. LJ Hooker is both a brokerage and real estate agent, which they’ve used to mitigate the effect of falling rental yields on existing clients. “As a real estate

provider our team has to become a bad news team, but we’re linking our mortgage guys through to say ‘however, Mr Smith, there are a lot of savings in the mortgage market at the moment; we could tie in a rate reduction on your mortgage,” Chapman explains. “As a brand we might cost them $40 a week in rent but save them $300 a month on their mortgage.” Finally, Oxygen broker Wyld argues that brokers need to look past rate altogether: “Nobody has a crystal ball… I don’t tend to recommend a fixed or a variable rate product based on what the market’s going to do.” Rather than make recommendations against a predicted schedule of rate changes, he looks at the client’s personal plans: “More important [than rates] is the structure of the loan and whether it suits them. If someone’s planning to start a family or looking to grow an investment portfolio, that’s what we should be focusing on.”

HOLDING STEADY IN MARCH The RBA’s decision not to further reduce rates in March took many by surprise – three out of the four major banks predicted a cut. That doesn’t mean it’s not going to happen, as governor Glenn Stevens’ statement implies: “Having eased monetary policy at the previous meeting, it was appropriate to hold interest rates steady for the time being. Further easing of policy may be appropriate over the period ahead, in order to foster sustainable growth in demand and inflation consistent with the target.”

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HEAD TO HEAD

HUW BOUGH

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Huw Bough: CROSSING THE NARROW SEA The ex-Westpac broker chief is well known to the industry, but in his new role at MyState Bank he’s planning the Tasmanian lender’s conquest of the mainland

MPA: With you, Melos Sulicich, Sandi Sims, and a number of ex-Westpac staff now heading MyState, would it be fair to say you’re looking to imitate that particular major bank? Huw Bough: I think there’s a lot of good things Westpac do, there’s no doubt about that. I think what we’d like to do is take the best of what they had, but also recognise that

about being small that allows you to be more innovative and also allows you to have a greater influence on the breadth of the business so you can achieve the outcome in a different way. Because [we’re] a smaller business, one of the things you can bring is the discipline and the rigour of a major bank, but being from a mutual heritage, one of the things that stands

“We want to have a really quick speed to yes, but we don’t want to lose sight of what makes us different, and that is being able to look at each potential customer in their own right” MyState is very different. If you look at the two organisations, in many ways MyState is in a sweet spot – you’ve got the MyState Bank brand and The Rock; we’re small enough to be agile and provide personalised service, and we’re also large enough to be a public company. Capped at $450m, we’re large enough to provide security and efficient systems as well. So I think there’s something

out for us is how our customers and our staff view us … [as] people who are passionate about their customers and treat every customer or partner as an individual. You can afford to do that when you’re a small business. [For example,] electronic lodgement is something we don’t have at the moment, but we’re looking to offer it by the end of the year … We want to have a really quick speed

MYSTATE BANK, MYSTATE FINANCIAL AND MYSTATE LIMITED Huw Bough’s employer has gone through a number of evolutions in recent years. Formerly known as MyState Financial, when the lender changed its name to MyState Bank in October 2014 it was already regulated as a bank by APRA. MyState Limited is the financial services group that owns both MyState Bank and Queensland-based regional bank The Rock. To keep things simple, when we use the term ‘MyState’ in this article we mean MyState Bank unless otherwise indicated.

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HEAD TO HEAD

HUW BOUGH HUW BOUGH’S CAREER TIMELINE

1998

Sets up Victoria-based brokerage Australian Home Finance Solutions

2005

Appointed head of broker sales at RAMS Home Loans and grows settlements from $372m to $1bn within two years

2008

After Westpac acquires RAMS, Bough becomes the major bank’s general manager of mortgage broker distribution

2011

Shifts to general manager of franchise business at RAMS Financial Group

2014

Joins MyState in August to head up business banking, wealth and brokers

Greatest achievement “I’ve always had a passion for self-employed people, having been one myself, and understanding what people do in terms of putting their houses on the line. So the proudest achievement would be going into organisations and developing a customer-centricity which benefits not only brokers but the end customers as well”

to yes, but we don’t want to lose sight of what makes us different, and that is being able to look at each potential customer in their own right. So whilst there’ll be a credit score system in the auto-approvals, we’re going to have a separate dealmaker team which will also look at reasons why [deals] weren’t approved, just so we don’t lose sight of what makes us different.

MPA: Since mid-2014, MyState has been focusing on brokers – so what practical steps have you taken to encourage brokers to consider you? HB: If we look back at the same period last year, the business had a contraction of $37m. Over the same period this year we’ve grown $155m; but $115m of that was in the second quarter. So there’s some really good momentum in the business … most brokers won’t have heard of MyState, but one in three Tasmanians have an account with MyState, so in Tasmania we’re a really strong recognised brand; we have 60,000 shareholders there. What we wanted to do was see whether we could replicate that and see what it would look like if we had it on the mainland. We started, just in Victoria, in partnership with one of the aggregators, just to check we had our processes and systems right, and the amount of business we were able to write off the back of that really surprised us. I think it’s given us the platform to invest confidently and look to expand the MyState brand on the mainland. With that particular aggregator, it was a matter of understanding their business model; having the right BDM in the right place, who understands their broker. It was important that the BDM, Ruth Creswell, understood what was important for the brokers, what was important for the aggregator, and it was important she provided the ‘speed to yes’, a strong service proposition. On the back of that, we obviously had our product niche, which was no LMI to 85% [LVR]. The result was really pleasing for everyone – them, us and the customers.

MPA: Where geographically is MyState Limited targeting for growth outside of Tasmania and Queensland? HB: At the moment, The Rock is our lender on most of the aggregator panels on the mainland, and obviously we’ve had good growth from that brand over recent times. MyState Bank has predominantly been a Tasmanian lender, apart from recently in Victoria. Over the next couple of months we will look to develop relationships with a number of aggregators and offer them the opportunity to have the MyState brand on their panels.

MPA: You want to become ‘Australia’s number one regional bank’ – what do you think separates the regionals from the non-majors? HB: I think it’s in the DNA of the organisation. If we look at the different brands, there are very few that have a mutual heritage. And by mutual heritage I think one of the things that really work from the customer’s point of view is that they connect on an emotional level off the back of experiences they’ve had over a period of time. If we’re able to replicate the service and the speed to yes and the consistency of service we’ve had across Tasmania to the mainland – which obviously we’re going to do through electronic processing and lodgement and so forth – that will be great, and we’ll improve upon that with investment. Then we can achieve some great things with our customers and partners.

MPA: How important is competing on rate when it comes to making brokers consider MyState? HB: I think brokers want to do the right thing by the customer, and that’s not always about the rate but about the structure of the loan. The reality is if you’re going to compete on rate you’re not going to be there for long, and I think that brokers understand that. What brokers enable organisations like us to do is bring competition into the marketplace, because we don’t need to invest in branches; in many ways our branches on the mainland are our broker partners.

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ADVERTISING FEATURE

We certainly aim to be competitive, but you need to be able to compete on a number of levels. You need to be able to compete on services, relationships, an understanding of what’s good for our business partners, and the brokers’ understanding of what’s good for their customers. There’ll be some customers who suit the MyState brand and others who don’t, and it’s about earning the trust of brokers so they can recommend the MyState brand.

MPA: Will The Rock remain an independent brand, or could it be integrated as MyState Bank goes national? HB: At the moment, MyState Limited owns The Rock and obviously the MyState Bank brand. We haven’t made any further decisions in that regard. The strength of The Rock and the growth we’ve experienced in recent times would tend to show that brokers are really comfortable recommending The Rock proposition, and their customers find that what we have to offer is compelling. That’s been particularly evident in recent times. Having multiple brands does offer opportunities for differentiation, but we haven’t yet made a call on that. At this point in time, we’re very happy with the growth we’re getting with The Rock brand, and we recognise the relationship that brokers have with The Rock brand, but we’re also very keen to grow through the MyState brand.

MPA: Where do you want MyState to be 12 months from now?

HB: I’d like us to be in a position where we’ve been able to build advocacy with our broker partners, that we deliver what we say when we say, where we exceed their expectations and as a result have customers who are advocates for our business and recognise the relationship we have with our brokers.

THE BEST RATE

IS LOWER “I think there’s something about being small that allows you to be more innovative and also allows you to have a greater influence on the breadth of the business”

THAN YOU THINK

Prime Finance’s managing director Merrick Malouf on why the cost of short term finance has changed – and you should to

The 2nd mortgage/caveat market is filled with a lot of lenders. For a broker the simple question is how much is your interest rate. If your client is paying more than 3% or even higher why, as a broker, would you risk losing your licence? ASIC requires brokers to give their clients the best rate in today’s market. Your client should not be paying more than 12% per annum. 1% per month will give brokers more flexibility than ever before in this market. This serviceability is workable for every SME Australia-wide. Prime Finance is the only lender in Australia providing 1% per month up to 80% LVR in 2nd mortgages/caveat loans. The increase in loans since we dropped the interest rate has been 10 fold. I would like to see other lenders drop their interest rate instead of charging higher rates. Over 10 years ago Prime Finance came into the market at 3% per month, when the standard was 5% and higher. It took a number of years for other lenders to follow but it happened. Now there has been another adjustment in the market I believe only genuine lenders will follow and this will give brokers and their clients affordable access to short term finance.

MPA: What would you say to brokers to make them consider MyState?

HB: It comes down to personal service. We can’t be all things to all people; we can be important business partners for our key stakeholders. ADVERTORIAL

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SPECIAL REPORT

NON-MAJOR BANK ROUNDTABLE

NON-MAJOR

ROUND T

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BANK

D TABLE

The Financial System Inquiry has changed the playing field immeasurably from 12 months ago. Our second roundtable brought back five representatives of Australiaâ&#x20AC;&#x2122;s leading non-major banks, to confront the most pressing current issues www.mpamagazine.com.au

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SPECIAL REPORT

NON-MAJOR BANK ROUNDTABLE AT MPA, we’re always looking for fresh opinions, so bringing back the same group of people to the same restaurant might seem a bit of a gamble. However, the non-major bank sector has, in the past 12 months, undergone some immense changes, perhaps the most profound affecting any area of our industry, brokers included. We reconvened the roundtable to discuss the new reality. December 2014 saw the publication of the Financial System Inquiry [FSI] Final Report, recommending sweeping changes to the financial system. Top topics included risk weighting, disclosure and SMSF lending; recommendations which, if implemented, could transform non-major banks in both positive and negative ways. Outside the FSI, we’ve seen huge strides forward in electronic processing and the increasing competition from online and peer-to-peer lenders, issues we’ve also addressed at this roundtable. Australia’s non-major banks are among the most vocal advocates for the industry, and no doubt you’ll already be aware of their value propositions. That’s why we’ve made the questions to this roundtable tougher and more current than ever. In stepping up and answering them, our panellists are giving you a unique insight into their changing businesses, and the direction of the entire sector in coming years.

Risk weighting and competition “The FSI’s a once-in-a-generation opportunity,” began Suncorp Bank’s head of intermediaries, Steven Degetto. He argued that, if implemented, the recommendations could “get back more balance to the power that’s been handed to the major banks since the GFC”. Degetto was certainly not alone in his opinion; our first question – whether the FSI’s recommendations could help our panellists compete against the major banks – elicited real enthusiasm from around the table. Risk weighting describes how much capital banks must hold relative to exposures, of which mortgage lending is one. The four major banks and Macquarie are currently the only ones that can use internal ‘IRB’ risk weights, which essentially makes it cheaper for them to lend than for the non-majors. The

THE PANELLISTS

Stewart Saunders, national broker manager, ME Bank

Steven Degetto, head of intermediaries, Suncorp Bank

“When you look at the marketplace and the interest rates for majors and non-majors, they’re all kind of similar … where cost matters is the back end”

Jarrod Cahill, state manager Vic and SA, Bankwest

Glenn Gibson, AMP Bank FSI Final Report calls for APRA to “narrow the difference” between major and non-major banks’ risk weighting requirements, a move called for by non-majors for a number of years. Four of our five non-majors explicitly welcomed the recommendations: Suncorp, ME Bank, AMP, and Adelaide Bank’s general manager third party mortgages Damian Percy, who described current risk weighting as “patently absurd … I think the fact the FSI is recognising that is a good and sensible thing”. Jarrod Cahill, Vic/SA state manager for Bankwest, was more cautious. “It’s difficult to

Glenn Gibson, head of sales and marketing, AMP Bank

Damian Percy, general manager third party mortgages, Bendigo and Adelaide Bank

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SPECIAL REPORT

NON-MAJOR BANK ROUNDTABLE attractive from a return-on-equity standpoint. So we may see business lending or other asset classes becoming more attractive.” Percy took a similar view: “On the assumption they’re implemented, and most people in this room desperately hope they will be, we may see a rebalancing in equity away from mortgages, which, given the discussions we’ve had around the Australian economy in recent years, is a good thing – that banks have an incentive to support small and mid-sized businesses.”

Disclosure and ownership

“We have a very strong vested interest in consumers’ trust in the broker sector being maintained. Hidden ownership, whether inadvertent or advertent, doesn’t help that” Damian Percy, Adelaide Bank say whether some of the proposed changes are going to be implemented … we’re a subsidiary of Commonwealth Bank and enjoy that tremendous relationship,” he said. “But we are an independent business and will operate according to those recommendations if and when they’re implemented.” When asked about implementation, the table had a number of suggestions. “The majors can do one of two things,” explained ME Bank’s national broker manager Stewart Saunders. “They could pass the increased cost of capital on to consumers in the form of higher interest rates, which then means as non-majors we can compete more with the major banks. Secondly, they

have the option to reduce their return to shareholders in the return on equity. I think we’ll see a mixture of both of these things.” AMP head of sales and marketing Glenn Gibson saw potential back-office benefits. “I suppose where it [matters] is the back end when it comes to the cost of capital. So our ability to reinvest or to grow our businesses behind the scene is a little bit tougher because of those increased costs.” Looking wider still, Saunders and Percy noted the effect that risk weighting reform could have on the wider Australian economy. “One of the other interesting things that may occur for major banks,” argued Saunders, “is other asset classes may become more

While risk weighting had the most direct effect on the outlook of these banks, the FSI’s disclosure recommendations aimed at brokers are also important to them. Recommendation 40 calls for regulators to “require advisers and mortgage brokers to disclose ownership structures”. Industry leaders have already cautiously welcomed the recommendations – an attitude echoed by our roundtable. Percy was first up, and clarified his view: “It strikes me that the vast majority of consumers going to a large mortgage broker or aggregator would be interested to know if that introducer or aggregator was owned by one of their product suppliers. Would that change their mind? I don’t know … but consumers have the right to know.” AMP’s Gibson backed up Percy’s opinion, noting that the level of disclosure should always reflect the level of information required for consumers to understand. Current arrangements are not without gaps, argued Saunders: “I think there’s room for improvement in the level of current disclosure. I think the vast majority of brokers in the market are very clear when it comes to disclosure, but there are some areas for improvement that we can see.” Saunders’ comment found support around the table, not least from Percy, who expanded on the need for disclosure: “The people in this room and the businesses we represent particularly are maybe the most reliant businesses on third-party introduction and distribution. So we have a very strong vested interest in consumers’ trust in the broker

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SPECIAL REPORT

NON-MAJOR BANK ROUNDTABLE “I think the jury’s still trying to work out what it actually means … What we’re happy with, though, is that we’re actually going to have some clarity,” Gibson said. “If you have a look at the last three years, the questions of will it remain, will it not remain, will it be residential, will it be commercial, will it need personal guarantees, have had a cloud of uncertainty around them. “I welcome when we finally get to a decision,” Gibson concluded, “so we’ll know exactly what we’re dealing with and how we’re moving forwards. As far as AMP [is concerned], we’re fully supportive of what the government decides to do, and we have a very strong business anyway.” Adelaide Bank’s Percy voiced strong support for the FSI’s recommendations: “I always get concerned when you see these types of changes to legislation described everywhere as a great ‘opportunity’ – opportunity for this party, opportunity for that party, but rarely an opportunity for the consumer. sector being maintained. Hidden ownership, whether inadvertent or advertent, doesn’t help that.” Of course, disclosure doesn’t just apply to brokers, and we asked Bankwest representative Jarrod Cahill whether consumers could distinguish between them and their owner, Commonwealth Bank. He said: “Bankwest is very clear that we want to be the best regional bank … Yes, we are owned by Commonwealth Bank of Australia, but equally we’re an independent business. And if we look at all of our marketing requirements and all of our advertising, it’s very clear that Commonwealth Bank is operating us under the one banking licence … the due diligence that the brokers undertake throughout this process needs to lead them to the right outcome.” Suncorp’s Degetto rounded up the discussion with the theme of trust: “I think there’s one word that’s been used, which is ‘trust’ ... . So [we support] anything which reinforces the trust in mortgage brokers, and the other thing is removing any conflict of interest or perceived conflict of interest. I think good brokers do make customers aware of which aggregator they’re part of; of who

“A more conservative approach to lending and gearing and SMSFs is, I think, important and prudent for ultimately protecting people’s nest eggs” Steven Degetto, Suncorp Bank has ownership in that; and if they’re going to be recommending a product which is funded by the owner of that entity.”

Curtailing SMSF lending Undoubtedly the most divisive issue at the table was SMSF lending. The FSI says it wants to “fufill the objective for superannuation to be a savings vehicle for retirement income, rather than a broader wealth management vehicle”. Its advice – to prohibit lending against SMSF – presents a major threat to some non-major banks. AMP Bank has long promoted its expertise in SMSF lending, and so it was to Gibson we first turned. How would a prohibition of SMSF lending affect his business?

“I think part of the reason the nation got through the GFC relatively unscathed was because our superannuation savings were relatively ungeared,” Percy added. “Tempering the enthusiasm for it and bringing the applications back down to commercial lending might be a good thing, but I may be a minority in saying that, I suspect.” He was not entirely in the minority, however. Suncorp Bank has some involvement in SMSF lending but can understand the FSI’s recommendations, Degetto explained. “We do have a small SMSF lending [strategy] focused around small business and commercial, because we see it as more specialised. I think, generally speaking, around SMSF lending, gearing can certainly amplify gains or losses.

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“There are a number of things coming along at a great number of knots that we need to be aware of ” Stewart Saunders, ME Bank “I think Damian mentioned a good point: a more conservative approach to lending and gearing and SMSFs is important and prudent for ultimately protecting people’s nest eggs,” Degetto said. “And I think that’s what we all want to see: Australian people building their superannuation nest egg and it being safe.” Of the remaining banks, ME Bank was “agnostic”, according to Saunders: “In view of our ownership structure by industry super funds, we don’t look into moving into that space in the future … we’ll support what we believe will promote a strong superannuation industry as a whole.” And Bankwest’s Cahill added a note of pragmatism: “It comes down to needs. From Bankwest’s point of view, we’ve never aggressively played in the superannuation space … self-managed super funds are a product that needs a lot of advice and regulation, and ultimately, if it’s right for the consumer then it’s their choice to take it.”

New sources of competition Non-major banks are known for innovation, but their smaller size can put them at risk from other innovators. Therefore, we decided to ask our roundtable who they’re keeping an eye on, who brokers should be keeping an eye on, and how they’re staying one step ahead of the so-called ‘disruptors’. “There are a number of things coming along at a great number of knots that we need to be aware of,” explained Saunders. Two things, he claimed, would imminently change the industry: the rise of direct applications online, and the implications of comprehensive credit reporting (CCR).

ME Bank’s response to direct online lending was investment, Saunders noted, and when it came to CCR, he saw an opportunity: “With more information available from all the banks and from positive credit reporting, we’ll be able to price more appropriately for risk [and] will look at different ways to be able to gear offers for consumers, which I believe will be really exciting for the industry.” We asked Suncorp’s Degetto if he was concerned about supermarkets moving into the space. “I wouldn’t say concerned per se,” he replied. “Certainly when customers are looking at who are they going to get financial advice from or mortgage advice, I think they like to search digitally, but I don’t think you’ll see them walking into a supermarket any time soon and asking someone at the supermarket necessarily for home loan advice.” Interestingly, Degetto did see “customers ultimately seeking information from brands they’re aligned to outside the banks or financial services”, but he regarded this as a longer-term threat. A more immediate threat has been the rise of online-only lenders, championed by Kim Cannon’s Loans.com.au. However, Adelaide

Bank’s Percy explained why online lenders were not yet his top priority: “I don’t think there’s a financial institution in Australia yet who has quite cracked the online mortgage space, but I don’t think it’s uncrackable … I’m not entirely convinced that the service proposition of businesses like [Loans.com.au] is sufficiently broad to appeal so vastly to create competition for us.” Undoubtedly, Percy argued, the industry would soon see existing brands expanding aggressively online, a threat made more powerful when combined with CCR. Brokers and lenders needed to stay on their toes, he concluded: “We should as an industry, and particularly those involved in broking, not get too relaxed about the notion that digital disruption either in broking or by brokers is not going to happen because everybody needs a person … Now that isn’t the case anymore and it’s quite likely in the medium term you’ll see brokers who are for all intents and purposes purely digital.” Not all of our panellists were so willing to gaze into the crystal ball. Asked about peer-to-peer lending, Bankwest’s Cahill was reserved, pointing out that the sector was still

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SPECIAL REPORT

NON-MAJOR BANK ROUNDTABLE in its “early days”. Similarly, AMP’s Gibson cautioned that “you don’t know what you don’t know”; technological advances in e-docs and electronic processing meant the only solution was to keep your business model as ‘fluid’ as possible.

Processing and back office Pricing clearly matters, but it is back-office processing that occupies an uneasy position at the heart of the broker-non-major relationship. Brokers often associate nonmajors with wildly varying turnaround times, preferring the dull, if consistent, processes of the majors. We were therefore interested to see what our roundtable was doing to counter these perceptions. Cahill from Bankwest began, explaining how the bank had learnt from extensive market research, starting from the front end. “Every state with a BDM now has a deskbased support officer, and that really enables us to manage the communication flow a lot more proactively and set expectations,” he said. “From the back end, we’ve really improved our processing from the queuebased real-time processing, and we’ve gone live with having a pot of assessors pick up, workshop and hold the deal. And that enables a conversation with the broker then and there if we are missing further information. And from a pre-settlement [perspective], [we are] improving our mailpacks – making it simpler for the customer; binding the documents, with less paperwork to sign.” While Bankwest has learned through research, Suncorp Bank has learned through experience. The bank was upfront in withdrawing its service guarantee of two business days’ turnaround last November, and we asked Degetto to reflect on the experience. “I think the key thing for us in ensuring transparency and consistency is that before we extended that guarantee and subsequently removed it, we were up front to brokers so they could make a conscious decision as to whether they would like to introduce their customer to us and help manage expectations,” he said. Suncorp is now back at the two-day mark, Degetto explained, but transparency remains their watchword, however painful that may

“Every state with a BDM now has a desk-based support officer, and that really enables us to manage the communication flow a lot more proactively” Jarrod Cahill, Bankwest be. “We can tell a broker when a deal comes in how many business days it’ll take; if it’s outside of the box and needs to go to a senior credit officer, how long that’ll take; then how long loan documents will take and also when loan documents are returned … [and] how long it’ll take to certify those documents for a purchase or refinance,” Degetto said. “And that’s updated daily, on our business partners’ online … They get the same

information that I do around the performance of our business.” AMP’s Gibson pointed to investment as reflecting the maturing of the non-major sector. “We’ve always struggled in the past with consistency … So we listened to our brokers and advisers and went out and seriously invested in back-office processing. And this is where it comes to maturity. We’ve spent in the last 18 months more on mortgage origination technology than we had in the preceding 10 years.” Technology is key, he added: “You can have a whole range of people who can sit there and talk to brokers on the phone, but they need to have the tools to be able to support that.” Percy explained why his bank was not sitting on its laurels: “Reliability of mortgage processing has probably been our thing for the last 15–20 years … But everything gets old – you just need to look around this table to understand that – and our technology needed refreshing.” Adelaide Bank has recently signed up Sandstone Technology to develop a new processing platform, the new system that Percy hopes they’ll be piloting by Christmas. Investment in technology is also important

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NON-MAJOR BANK ROUNDTABLE

to ME Bank. Saunders explained that after four years of development the bank was “feverishly” working towards the release of their new core banking system, which would have a direct impact on turnaround times, “To put it into the perspective of an individual file, that automation through to process will equate to between two and two and a half hours’ administration time per file,” he said. “So it’ll effectively increase the capacity of our processing area substantially, and [we’ll] be able to deal with increasing growth into the future.”

Regaining lost ground It’s been almost eight years since the GFC, but non-majors are still working to regain the market share lost to the major banks during those tumultuous months. For our final discussion, we asked our panellists what they were doing to regain consumers’ and brokers’ trust. For Adelaide Bank, Percy explained, the first step was telling their story: for consumers, “not many know the Adelaide Bank story – that we’re part of Bendigo and Adelaide Bank, one of the largest banks in Australia, with 6,500 staff. The Bendigo guys have 527 branches; still half or more of our origination is being done through third party”. But sharp pricing and personal service

were also crucial, he added. “We talk a lot about technology in our business, we talk a lot about disruption, but ultimately it’s a people game, and we’re trying to keep a hold on that as we go through the changes of the next couple of years.” Moving away from the GFC has meant re-emerging from niche strategies, argued AMP’s Gibson. “If you go back to the last year or two, I don’t think it’s been hard for us to get business; we know what we need to do. If you look at the non-majors, we’ve all had stellar years ... So I think going forward, the year will be all about competition; understanding what you’re good at; more importantly, understanding what you’re not good at, and making sure you can tailor your service and your products and niches to the people you want to deal with.” Suncorp’s strategy will be about removing obstacles to brokers, Degetto explained. “We strongly believe that brokers try and make the best decisions in the interests of their customer, but we want to remove obstacles.” These include processing, but also the confusing commission structure. The bank has run a number of promotions offering increased commission and discounted rates, an approach Suncorp will continue. “We’ll continue to have a competitive offering into the future; that’s crucial,” Degetto added.

Bankwest has been keen to build commercial lending in recent months, Cahill said. “We know it’s an emerging market and it’s definitely a piece of the market that we want to support and grow. From a retail perspective, any brokers that we work with who we can make an introduction to one of our commercial BDMs, we will.” However, the bank is also continuing to respond to feedback across its services, and give brokers more information about what Bankwest does. “We’ve definitely evolved and want to evolve,” Cahill said. Concluding the roundtable on a high note, ME Bank’s Saunders commented: “I think the non-major sector has been fantastic at building trust … we’ve seen the share of business that non-majors are getting from brokers grow over the last 12 months. Underpinning that is the competitive offer.” Competition means pricing, he explained, but also BDM support and offerings in particularly spaces, and in ME Bank’s case, fixed rates. Ultimately, Saunders argued, the bank needs to match the broker: “I think all of us agree we don’t try to be everything to every broker; each of us has different strengths and different things we want to focus on, and it’s about raising that awareness with brokers in whatever ways that we can.”

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FEATURES

DIVERSIFICATION Property appraisal

Wealth creation

ation Superannu nt manag eme

e s tar t her

Firs t home nce buyer fina

s t n e i l C

Inves t ment finance

nce Asset fina g Refinancin

DIVERSIFIED BROKING:

LEARN FROM THE MASTERS Thereâ&#x20AC;&#x2122;s nothing like learning from the best. Maya Breen went out to the pioneers and leaders of diversification in the broker space and asked them how their different brokerages bring clients back again and again

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Sponsored by

says. “You’re still going to get the odd one who’s a little bit uneasy, asking ‘what’s the catch?’” Moses says often mum-and-dad clients are hesitant when new products are offered, but requirements by ASIC present a good opportunity to introduce them. For example, if debt is being negotiated, the client must be asked whether they have risk insurance. “There’s always going to be the push factor with any additional product that you offer, other than your first-line product. As long as you’re able to sell it, which is everything that we’re about, and make it interactive in terms of how it benefits the client, that I think is the most important,” says Moses. “If they see the fact that they only need to go to one place to get it organised, again you’re offering the private-bank experience, and I think for what we do it far exceeds what a private bank would do in a bank.” The Loan Arranger is more reactionary than proactive when it comes to introducing new products to its clients. Marshall says he’s been in the business so long that, if he became too proactive with the 1,500 to 2,000 active clients that he has access to, he wouldn’t be able to handle the business. “What we offer and provide as a service to our client base, what’s testament to that is the fact that we seem to have clients that are still with us that we did original loans for back in the ’90s. It’s not unusual for 10-year clients to come back to us saying, ‘You helped me 10 years ago. I need your help again’. “I always say that, from a scale point of view, we, as a broker group, and brokers in general are always going to offer a better service than the banks can, because we’re more micro and they’re macro,” says Marshall. McCartney says every customer presents an opportunity, and much of the outcome lies with the personality of the broker. He makes sure when recruiting a new team member that they have the right skills to spot those opportunities during conversations with a client, and then trains them to reach a high level of product knowledge. “You might not be able to help the customer today with a house loan, but you might be able to help them tidy up their superannuation, tidy

up their insurance, and tidy up personal loans.” Moshe, McCartney and Marshall all stressed that getting diversification going was actually not the hard part, but what you do afterwards.

You’ve diversified… Now what? “I don’t think we found diversifying a problem,” says Moshe. “I think it’s once you are actually in it, it’s maintaining it. We’ve got 22 people all up in Sydney, Hunters Hill, Brisbane and Adelaide, and that in itself you’ve created a reasonable monster.” Marshall has seen many businesses find themselves out of their depth and treading water they have no experience in. “It’s about simplifying it, not overcomplicating it,” McCartney says. “We’re really

DO BROKERS NEED A NAME CHANGE? Moshe Moses of Astute says the term ‘broker’ is misleading and not as palatable these days, since other industries have been tarnished. While the MFAA now refers to brokers as ‘credit advisers’, Moses argues this philosophy now needs to be extended across the whole industry, not just the one association. “When people use [the term ‘broker’] they associate it with all different aspects rather than that these guys are as professional if not better than those people that you’re dealing with at a bank.”

“You might not be able to help the customer today with a house loan, but you might be able to help them tidy up their superannuation, tidy up their insurance, or tidy up personal loans” Scott McCartney, general manager, Let’s Finance customer-focused, so it’s more about doing it cheap and as cost-effective as you can for the customer.” He says of course there will be some revenue raised out of it, but making sure it’s the right thing for the customer takes first place. “I’ve seen customers being hit with big superannuation insurances – you know, $5,000–$6,000 – and you think, ‘Hang on. Is that the best thing for the customer?’ And we’re picking up the pieces.” When asked what advice they would give those looking to diversify in the near future, Marshall recommends finding referral partners that have the same ideologies and the same expectations, and he says it’s important to remember that their customer is your customer as well.

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PROFILE

MARDEE THOMAS

PEOPLE, PRIORITIES AND A DASH OF PERSISTENCE Mardee Thomas, one of Australia’s most awarded female mortgage brokers, tells Maya Breen the accolades are wonderful but it’s the people she’s really passionate about

NOT MANY would choose to stay on course down a path after hearing, “look, it’s not going to be an easy road”. That’s the fair warning Mardee Thomas was given before she ventured into the broking world but she went down it anyway armed with gumption, grit and a strong work ethic. Commitment-free and living at home, Thomas took on the challenge at an opportune moment in her life, but that didn’t make the first six months in the industry any less difficult. “I was pretty much thrown in the deep end when I first became a broker – a lot of door knocking, phone calls, shut downs – a lot of times where you think ‘oh, am I really worth it? Can I do this?’ ” says Thomas. But fast forward 14 years, and she’s climbed to the very peak of her game, receiving more awards than any other female broker in the country. Most recently, Thomas took home the AMA Broker of the Year award for productivity, recognising achievements in increased office efficiencies and quality submissions, which she topped with a 100%

submission quality ratio. “That was very unexpected,” Thomas says. “You don’t get these awards every day so to have a trophy up my sleeve is really fantastic and I couldn’t be happier.” One can believe it was unexpected as it becomes evident that all Thomas’ energy and passion revolves around her clients, so the awards just follow as a result. “I look at it now and think that we’re probably one of the best industries that you could be in, in terms of what we do and how it evolved, meeting lovely people and the journey that we see.” However, mortgage broking wasn’t always on the cards for Thomas. After graduating with a business and marketing degree at Texas Wesleyan University in the US, she came home to figure out where to go next, and before she knew it, was grappling with the responsibility of influencing the direction of other peoples’ substantial life savings. “It was not something that I initially thought I wanted to do, but I’m so glad that it did come to me and I’m very lucky to have had that opportunity via the Wizard

MARDEE’S MANY MERITS AMA 2014 Broker of the Year – productivity listed in the Top 50 Elite Business Writers selected as finalist within the Finance and Residential Broker categories for the last three consecutive years consistently appears in the MPA’s Top 100 Brokers report

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PROFILE

MARDEE THOMAS

“I was thrown in the deep end when I first became a broker – a lot of door knocking, phone calls, shut downs – a lot of times where you think ‘oh, am I really worth it? Can I do this?’ ” Surry Hills branch,” says Thomas. Wizard Home Loans was where she got her start and built her exemplary reputation. However, after nearly a decade at the company, she was forced to re-examine her career when Wizard was bought out by Aussie Home Loans. “I decided ‘well, I can either stick at it and be under a franchise model for the next however many years or become my own person and grow my own business.’ ” So, after going the extra mile for her clients and spending a year with Aussie to make sure they were all taken care of, she joined

1st Street Home Loans, and the last five years have gone by in a blink. 1st Street has garnered troves of awards each year which Thomas credits to the company culture, led by example by the founder and director, Jeremy Fisher. “When you’re in the kind of role that we are in, which can be very cut-throat sometimes because it is a commission-based operation, we’re all very much on each other’s side and want each other to do well,” Thomas says. Now, more than eight brokers all work their own companies under the 1st Street brand and share common ground in age,

children and way of life. “That’s probably what I love about it the most. We have a good camaraderie within the office and I think that’s why we do so well. I love what I do.” Fisher was running the show on his own for 10 years before he saw it wasn’t the way the broking industry was evolving and so brought Thomas on board. “Going from a one-man band to where we are now is quite amazing. We’ve had a big growth phase over the last couple of years,” says Thomas. Part of the success of their business model stems from 1st Street taking ownership of the initial enquiry all the way to settlement, and being a constant point of contact for their clients, which they appreciate. Thomas has seen a change in her client base over the last few years, going from first homebuyers to now more developed clients with a portfolio going forwards. But she enthuses about the young generations coming through and their texting and tweeting ways. “I’m very old-fashioned,” Thomas says with a laugh. “I’ve got my calculator and I’ve got my pen,

PRACTICAL PRODUCTIVITY PEARLS OF WISDOM

Make sure every piece of supporting documentation is accurate

Have everything vetted by someone else before submission

Work closely with banks for best possible turnaround time with the least amount of errors

Update clients on everything through seamless communication

Have an all-in-one CRM system to efficiently address all requirements and keep track of clients at different stages in the process

Use email templates at suitable checkpoints

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PROFILE

MARDEE THOMAS

BEING A WOMAN IN BROKING

Mardee Thomas has noticed more and more women are seeing a broking career as a great path to a balanced lifestyle. “When I first started it was very male-dominated and, you know what, it probably still is. There’s absolutely nothing wrong with that – I love working with the guys, but it’s so lovely to see that there are a lot more women coming into

the industry now.” The flexibility the profession allows is an appealing aspect for women with children and family commitments, she says. “It’s not like a 9-5 office job where there’s no way out of that – if you’ve got a swimming carnival to get to, you can go for an hour and it’s not going to affect what’s going on in the work environment.”

so let’s do some figures.” Despite holding on to certain tools of the past, she has no problem connecting with clients from any walk of life and forming a thriving working relationship. “I’m not shy of striking up a conversation. For me, the customer service isn’t a chore; it’s just making sure that we deliver on what we do offer. I think sometimes that can make or break a broker in a way because the connection that you get with that client really determines whether they will probably proceed with you.” Thomas often becomes good friends with her clients after dealing with their lives for quite a long time until they reach where they want to be financially. “That (customer) connection is where I get my biggest joy. If they can trust you and really want to be working with you, it’s amazing.” When asked how she achieves such high productivity scores and raving customer service testimonials from clients, she modestly diverts the glory away from herself and on to logical thinking. “What we do is really not brain surgery: it’s just making sure that we have everything in place and that it’s documented properly before it’s even submitted. And that’s where a lot of mistakes can occur, if it’s not vetted properly before it goes in the system.”

1st Street brokers involve themselves as much as possible with the agents, the solicitors and conveyancers, forming strong relationships where it all boils down to keeping in contact.

“It’s an awesome feeling to help people get into a position in life where they’re just going to be in the best spot possible going forwards” “I know it sounds so basic but some people really don’t understand the process that much. So just by being involved 100% with the whole transaction instead of just the mortgage, we try and make ourselves really known throughout the whole process with everyone involved.”

2015 at 1st Street will see keen, new brokers coming on board to help manage their growing client base. “We’re getting quite busy and we don’t want to lose that customer service side of things where we can’t manage all our customers properly.” They will continue to grow their financial planning side of the business and their community engagement, which has already seen them support a charity each month. “A lot of clients really love that we’re donating a bit of our commission to good causes going forwards, which has been really lovely, instead of just going into our back pockets.” Thomas says the challenge that anyone entering the industry will find is supporting yourself financially while making a name for yourself and working some crazy hours in the early days. “To me, every deal is so different and my challenge is that I don’t like being defeated. The biggest challenge I ever had was just getting out there and knocking on doors when I first started and getting people to know who I am.” Yet once you have established yourself and done the hard work, the rewards are well worth it, Thomas concludes. “The clients’ appreciation is probably my biggest achievement – of course, all the accolades are wonderful, but from a personal aspect that’s definitely the highlight of the industry.”

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FEATURES

CHALLENGER AGGREGATORS

CHALLENGER AGGREGATORS:

THE HARDEST BALANCING ACT OF ALL

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Small and medium aggregators face some of the toughest competition in the industry, and have stepped up their proposition to brokers in response, writes Sam Richardson BROKERS

WANT

it all, and so aggregators promise it all; cutting-edge technology, fawning BDMs and ultracompetitive fee structures. The problem with over-promising, however, is the danger of under-delivering. Nowhere is this truer than the world of ‘challenger aggregators’, where the battle against hubris, and lock-in clauses by established aggregators, necessitate a particularly impressive proposition to brokers. That’s not the only balancing act which challenger aggregators need to perform. Smaller organisations in this industry, not just aggregators, have generally been associated with independence, personal service and below-average pricing. All of the challenger aggregators consulted for this article subscribed to at least one of these mantras, while recognising the extreme difficulty of achieving them all. For this article, we’ve investigated how the key challenger aggregators are approaching this balance and the benefits for brokers. We’ve also considered the role of technology – once considered a death-knell for smaller operators – and how challenger aggregators approach or avoid the ‘armsrace’ with larger aggregators’ IT systems. With so many different strategies, just one thing is certain: the intense competition in this sector is driving innovation at a formidable pace.

MEET THE CHALLENGERS

Brad Wood, director, Astute Financial Management

Gerald Foley, managing director, National Mortgage Brokers

Tanya Sale, CEO, Outsource Financial

William Lockett, managing director, Specialist Finance

Paul Liccione, general manager sales & distribution, eChoice

Brendan O’Donnell, managing director, Liberty Network Services

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FEATURES

CHALLENGER AGGREGATORS CHALLENGER VS. BOUTIQUE AGGREGATORS You may have noticed we’ve used the word ‘challenger aggregators’, whereas some of the aggregator chiefs themselves use the term ‘boutique’. It’s an important distinction to make: all of these aggregators here are challenging the main players, but only some are boutique aggregators. And how do we define that? The Oxford Dictionary defines a boutique business as “a business serving a sophisticated or specialised clientele”; while all these aggregators want to grow profits, only some intend to do that by increasing market share; whilst others have a specific type of broker they’re looking for – they’re ‘boutique’ in this more specific sense. To further complicate matters, some ‘boutique’ aggregators reject the term, preferring to describe themselves as ‘specialised’. Thus ‘challenger aggregators’ is a useful term to group together these small and medium-sized aggregators.

SMALL OPERATORS Challenger aggregators are often equated with small aggregators. While major aggregators have broker numbers in the thousands, smaller players have numbers in the hundreds. William Lockett, manager and owner of Specialist Finance, argues a small size gives a big advantage: “We say it’s never been better for a boutique aggregator… a large part of the enquiries we get is because we’re not big and we’re not controlled by a bank or industry partner.” In fact, Specialist Finance has a number of offices overseas, but Lockett insists their numbers in Australia remain small enough for him to deal personally with his brokers. Having a single manager able to converse directly with individual members gives Specialist Finance particular flexibility, he adds: “It’s very easy for us to adapt to market changes and industry trends because we have that flexibility and I own the business and can decide to go in that direction – I don’t have to sit in a board meeting with 10 people and take a vote.” In recent years, smaller broker groups have been linked with exclusivity, with some smaller aggregators going as far as setting limits on their broker numbers. Outsource Financial was one of those aggregators, Tanya Sale notes, and whilst the success of her approach has pushed numbers over the target of 200, it remains an exclusive organisation: “We have grown over 200, but the big thing for us is that we’re still interviewing and picking and choosing who comes under our umbrella.” This includes Sale meeting all prospective members. Controlling numbers is difficult not just because well-regarded aggregators are approached by prospective new members, but because larger brokerages want their new staff to be included. In Outsource Financial’s case it was their growing financial planning and accountancy clients who pushed up numbers, Sale explains: “We can’t say ‘200 members – wahoo!’; we can’t because our members are saying ‘we want this person accredited’.” Distinguishing between small and

medium aggregators can be difficult. Liberty Network Services is presently crossing that divide, according to managing director Brendan O’Donnell. With 62 brokers covering all of Australia’s capital cities and many of the major regional towns, they hope to grow to 100 by the end of this year; “This phase of growth is going to get us to that critical mass level”. Once beyond 75 brokers, O’Donnell reckons, it will suit Liberty Network Services to add national marketing campaigns to its present localised approach.

“Our philosophy and approach is around brokers who want to go on a journey from being a broker to building a broker business” Gerald Foley DEBATING INDEPENDENCE Smaller operators, not just in aggregation but industry-wide, tend also to be associated with independence. Indeed among challenger aggregators are some of the most vocal critics of vertical integration in the industry, perhaps none more so than Outsource Financial’s Sale: “It comes down to why the third party channel was built… over 50% of mortgages go through brokers and this was built on independence; it was built on aggregator groups going out there and saying that we’re going to keep the major four honest.” Sale regards the Recommendation 40 of the recent Financial System Inquiry’s report – which argued brokers should ‘disclose ownership structures’ – as an encouraging nod towards independent operators: “If

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ASIC are pushing disclosure, and there’s a bank-owned aggregator with that bank’s products on its panel, why shouldn’t there be disclosure all the way through?” She also notes that major changes in the financial planning industry won’t go unnoticed by the new generation of brokers: “I think opportunities will be created because more and more brokers, not just the old-school ones, but also the new entrants to our industry, want independence.” Not all challenger aggregators see independence in such black and white terms. The 2012 acquisition of National Mortgage Brokers (nMB) by franchise giant Aussie was perhaps the most striking example of vertical integration in the challenger aggregator space. Encouragingly for the proponents of challenger aggregators,

“More and more brokers, not just the old-school ones, but also the new entrants to our industry, want independence” Tanya Sale nMB has remained a separate business, and are headquartered in a different city to Aussie. In fact, Aussie’s white label product was only added to nMB’s lender panel in late 2014. “We don’t hide the ownership,” insists nMB managing director Gerald Foley. “I don’t think there’s anything disadvantageous to the brokers or the consumers they deal

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FEATURES

CHALLENGER AGGREGATORS

“Everyone provides services, everyone provides support. What we do is help you get more sales through these specific tools and programs” Paul Liccione

with that you’ve got strong corporate backing.” At the time of the acquisition, Foley pointed to “talk in the market about consolidation and the need for growth and sustainability, and you have the option to get in front of change or to follow it”. The raison d’être for the acquisition – that aggregators require significant investment – has not gone away; NAB Broker chief Steve Kane noted at MPA’s recent Major Banks Roundtable that “to run aggregation today requires a lot of capital; you can’t just sit on the same software for extended periods”. At the opposite end of the independence scale is Liberty Network Services, which was set up by non-bank lender Liberty Financial to distribute its products, although its brokers also have access to a 16-strong lender panel. The association provides excellent value for brokers, argues O’Donnell: “We don’t take a large proportion of the upfront or trail, in fact we take a very small proportion, because the focus is the business we write through Liberty and the margins we make on that business.” Close association, O’Donnell adds, also increases the benefits of the branded retail model (explained below), as brokers benefit directly from Liberty Financial’s extensive marketing campaigns.

TARGET BROKERS Big or small, independent or owned – what do you, the broker, prefer? This question, it should be noted, works both ways. Challenger aggregators have strong individual personalities and unique value propositions, so it’s worth checking if your aims and identities align and deciding whether you are that aggregator’s target broker. A word of warning here: aggregators are understandably reluctant to turn away prospective members. Indeed some, such as Specialist Finance, target the entire market with its four different fee models. “The flexible fee agreement represents all the options out there to brokers today,” explains Lockett. Yet a common theme running through all these aggregators is providing more than a service and instead being a

‘business partner’. Many are set up to support particular types of partners, and told MPA who they’re looking for. For nMB, their ideal broker is focused on growth: “Our approach historically, and more so in the future, is we will work with brokers on a mission to building a broker business.” nMB has a number of high profile members who’ve built leading brokerages, such as Gerard Tiffen’s Tiffen & Co, and nMB aims to replicate their success by providing customised support on such issues as picking a partner, establishing processing procedures, and moving brokers away from reliance on family members. eChoice, both part of and now the new name for the entire Firstfolio group, is looking for brokers that mirror the technology-driven strategy of new CEO Peter Andronicos. Newly appointed general manager of sales and distribution Paul Liccione notes that “ideally our broker is

“Branded models provide a framework for brokers to do what they’re good at” Brendan O’Donnell either comfortable with technology, or simply appreciative of where things are heading and comfortable in adopting technology. That’s really a key criteria if they’re to take advantage of everything eChoice can provide”. eChoice prides itself on a number of technological tools, with database marketing at its centre. Ultimately, taste in brokers is central to business identity, such as in the case of Astute Financial, explains director Brad Wood: “I don’t know if the word boutique is what we’d class ourselves as… aggregation is aggregation; challenger; boutique; Top 10;

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FEATURES

CHALLENGER AGGREGATORS

CHALLENGER AGGREGATORS’ BROKERS While brokers using challenger aggregators make up a small proportion of the total, they are relatively well represented in the industry’s elite, comprising

of MPA’s Top 100 brokers* * reports refer to 2014

all that business we don’t concentrate on. We’re probably a specialised aggregator; we deal with experienced brokers with strong businesses who want to build them further.” Astute does admit novice brokers, but puts them in contact with experienced members, which they believe increases their chances of success. In similar style, Liberty Network Services also links broker type to its business model; O’Donnell argues their branded retail model has particular attraction for the new entrants: “New to industry brokers will be looking for a good, solid home which gives them the flexibility to manoeuvre. There are exceptions to the rule, there always is, but as a general rule the branded model has become a lot more attractive, a model which will look after them for the duration of their time as a mortgage broker.” Finally, Outsource Financial is an example of an aggregator which serves a

“It’s very easy for us to adapt to market changes and industry trends because we have that flexibility and I own the business” William Lockett variety of members, but is currently targeting a specific group, in their case also new entrants. “We’re a vibrant and innovative industry and that’s what we should be attracting,” comments Sale. “New entrants were just as quickly going out the door because of the cost; they were being charged, put under one of the aggregator’s large broker groups, their commission was

lower than normal, and they just couldn’t survive.” Outsource Financial’s free, new entrants program, she claims, has already attracted a number of new brokers and is emerging as a major success.

RACE TO THE BOTTOM Clearly, challenger aggregators have strong identities and are interested in strong partnerships. And undoubtedly the business partner approach provides a huge number of advantages for brokers in terms of services and attention. When it comes to fees, however, this approach has both positives and negatives – ranging from individual deal-making to traditional inflexibility. For all aggregators, the launch of Connective’s flat fee model proved a watershed moment, in terms of both flexibility and the idea of minimal and inexpensive core aggregation services with optional add-ons. The move divided the industry: for some aggregators it was a natural development in industry relationships; for others it marked the beginning of a dangerous ‘race to the bottom’ where profitability is becoming increasingly threatened. The challenger aggregators MPA spoke to largely veered towards the latter opinion. “I’m not a fan of these flat fee structures,” notes Sale. “I can’t see them being very profitable or viable; I guess people on flat fee structures rely on very high volume, [whereas] we rely on quality.” Sales’ opinion was echoed by Astute Financial and also eChoice’s Liccione, who notes that “over the last few years there’s been a trend towards giving more and more away. This is becoming more and more common and is less and less profitable because ultimately we’re a business like anybody else, so our proposition is around what we are doing to add value to your business”. eChoice does offer optional extras, and takes great care to show return on individual broker investments, Liccione insists. “We’re not just trying to sell you these programs… we’ve got statistics to

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show that your $1,000 investment equals a $25,000 net return within six months.” However, some challenger aggregators believe the whole culture of measuring individual services by short-term dollar value imperils the very business partner relationship which attracts brokers in the first place. nMB chief Foley is among them: “We like conversations with brokers who are on that journey; ‘how can I work with my aggregator to grow my business’ rather than focusing just solely on looking to achieve a greater commission split with my aggregator; that’s not the answer for the success of the industry long term.” Two players who do unequivocally compete on price are Liberty Network Services and Specialist Finance. Liberty can do this because of their abovementioned relationship with the lender, O’Donnell told MPA, but Specialist Finance is somewhat more typical of challenger aggregators. “As you grow the business you need to have agreements which are representative of where the market is today,” reasons Lockett. “It’s the way the industry has gone. We can do that more easily because of our boutique size; you and I can cut a deal, because you’re liaising directly with me.” If, as Lockett says, the challenger aggregator model promotes more flexibility, one is left wondering how the dream combination of personalised service and low

fees affect an aggregator’s margins and sustainability; although it should be noted that Specialist has been operating since 1991. Then again, perhaps brokers have cause for concern at the conservatism of other challenger aggregators and their unwillingness to reconcile the terms ‘business partner’ and ‘flexible fees’; they risk being left behind in an industry turning towards the latter.

AFFORDING TECHNOLOGY Beyond fees and the sustainability of individual business models, the sustainability of the entire challenger aggregator proposition is a question that refuses to go away. It all comes back to the question of capital, independence and nMB’s 2012 acquisition by Aussie. John Symond argued that the cost of technology would drive out smaller aggregators, a view shared by the outgoing nMB CEO Paul Gollan, who told Australian Broker that “it is not so much the cost of operating a boutique aggregation business that is prohibitive, but the cost of not being able to match the big boys’ technology that will see the process of consolidation continue”. Sitting at that supposedly hopeless crossroads between cutting-edge technology and smaller size is eChoice and, naturally, they don’t agree. “Symond was talking about combining new operation systems while

“I don’t see us as a challenger aggregator trying to challenge the likes of PLAN, AFG and Connective anyway. We’re just doing what we do and we’re doing it to the best of our ability” Brad Wood

www.mpamagazine.com.au

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FEATURES

CHALLENGER AGGREGATORS CHALLENGER AGGREGATORS’ BROKERS Unsurprisingly they’re also particularly vocal in holding aggregators to account, comprising

20% of respondents to MPA’s Brokers on Aggregators survey* * reports refer to 2014

being price-driven,” Liccione responds. “We invest in technology to provide income opportunities for everybody.” Every investment in technology by eChoice is made with a specific return in mind, both for the broker and for eChoice from the broker’s increased settlements, Liccione argues. “It’s a different approach to where aggregators traditionally come from, which is ‘jeez, technology costs a fortune but the brokers demand it’, to us, where investment in technology is based on return on investment.” It’s debatable whether other aggregators do think like that of course, and some challenger aggregators are adopting a more reserved attitude towards technology. “My personal view is you’ve got to be at the table,” nMB’s Foley comments. “You’ve got to meet minimum requirements. Do you need the best technology in the market? I don’t think so. It’s got to be competent, malleable and flexible… there’s quite a range of views in the broker space around what systems do for the broker, so it’s got to be flexible.” Technology is a significant cost, but nMB’s biggest spend and biggest offering is people, Foley concludes. In technology as in many other areas, challenger aggregators need to pick their battles with the major aggregators carefully; many prefer to concentrate their strength on a single area. But some refuse to envision a conflict in the first place, including Astute chief Wood: “I think at the end of the day you’ve got to listen to your members and do what they want and then create the service offering and support structure to support the businesses they want. I think if you get that right the rest of it comes anyway. I don’t see us as a challenger aggregator trying to challenge the likes of PLAN, AFG and Connective anyway. We’re just doing what we do and we’re doing it to the best of our ability.”

SPECIALISED FUTURES Wood’s conclusion is enviable, but the reality for most challenger aggregators is that they do need to attract brokers away from the big players. Those who succeed in doing so share a common theme: brokers

might want it all from their aggregator, but the real innovation is coming from specialised firms. All these challenger aggregators provide the full range of basic marketing, IT, training and support services, but they also have individual strengths, whether it be technology, building businesses, independence or flexible fees.

“We’re probably a specialised aggregator; we deal with experienced brokers with strong businesses who want to build them further” Brad Wood Looking forward, it appears that major aggregators and brokers could learn a lesson from challenger aggregators. For aggregation to continue being profitable and avoiding dependency on bank capital, there’s certainly an argument for accelerating the process of specialisation, which is already evident in their branding and marketing. Continuing with that argument, one could claim that brokers need to drop the idea of an aggregator for life. Perhaps an intense training-heavy ‘partnership’ aggregator suits a very different stage in your career from a flat-fee minimum service offering, even if both have their merits. Encouragingly, the survival and in some cases growth of challenger aggregators shows that innovation is being rewarded. Their success depends on asserting their identities and ultimately reaching out to those brokers who share those interests, and whose dissatisfaction with the big players is matched by real action – are you one of them?

www.mpamagazine.com.au

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16/03/2015 2:35:29 PM

BUSINESS STRATEGY

CUSTOMER SERVICE

CREATING A CUSTOMER DELIGHT CULTURE In an incredibly competitive business landscape, it is vital that you keep customers not just satisfied but delighted! In an extract from his book From Deadwood to Diamonds, Stefan Kazakis reveals how to wow customers – and keep them for years to come

AS YOU know by now, a key part of the colour of your business is how you treat your customers. Without customers your business is nothing, even if you have the greatest products or services in the world. If people aren’t buying, you have an expensive hobby not a business. So let’s have a look at how you delight your customers. Not satisfy, delight. If you want your customers to come back to you time and time and time again, just meeting their needs is not good enough. There are dozens, and maybe even hundreds, of other businesses out there that will meet your customers’ needs just as well as you can. It’s the minimum standard to be in business at all. To build a prosperous and sustainable machine that puts money in your pocket for years to come, you need to be proactive and think outside the square. You need to keep getting better and be an innovator. You can’t simply wait until there’s a problem and then step in and help. You need to offer the solution to the problem, and more. You need to see the problem

before they do. You should always be communicating with your customers and seeing what else you can do to help – there will always be something. If you run a gym, can you open up a small crèche to look after the kids while the parents do a workout? If you’re a mechanic, start washing your customers’ cars at no extra cost. If you sell computers, throw in a free game with every computer sold so the kids can’t wait to get home and use it. Go above and beyond. That’s how you delight your customers. That’s how you keep them coming back. If you own a restaurant, feed them! Have an abundance mindset; don’t have an attitude of scarcity. Give them an extra glass of wine. Keep bringing them bread throughout the meal. Bring a free bowl of chips for the kids. The small cost will disappear into insignificance when you start turning your customers into raving fans who come back to your restaurant time and time again and they also tell their friends. Make a Customer Delight Culture a nonnegotiable part of the colour of your business.

Don’t just serve your customers, wow them! Make sure all your staff have the same approach. Show them that you care, not with a fake smile and a voucher for $10 off next time but by genuinely caring and being interested. Play dumb and dig deep. Make them feel as if they are the most important customer you have ever served – because they are. Each and every client is vital to the ongoing success of your business. A great question to ask yourself is, “How can I give my customers something more than they expect?” It’s simple but powerful. And here’s the key to creating a true Customer Delight Culture: you need to think outside

www.mpamagazine.com.au

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You can’t simply wait until there’s a problem and then step in and help. You need to offer the solution to the problem, and more. You need to see the problem before they do

the box when you answer this question. A crèche in a gym, washing cars for a mechanic and free games with a computer are great steps in the right direction, but they are just the beginning. What about giving your clients movie tickets, or a voucher for a restaurant, or sending flowers on their birthday? Business owners often look a bit surprised when I make these suggestions. It usually goes something like this: “But I run a gym; why would I give them movie tickets?” I want you to have a think about this right now. Why would you give them movie tickets? Do you have the answer yet? Think about it … It’s actually really simple. You’d give them

movie tickets because they’ll love it! That’s it! It doesn’t necessarily need to be related to your business. It doesn’t always have to be something they’ll expect from you or related to your products or services. Imagine if you signed up for a gym membership and you received a welcome letter that contained two gold-class movie tickets. Or you picked your car up from the mechanic and the tickets were sitting on the front seat. Wouldn’t you be blown away? Wouldn’t you tell your friends? I sure would.

The critical non-essentials matrix What are five things you can do for your

customers that are critical for them to be delighted but that are not essential? Let’s have a look at what I call the Critical Nonessentials Matrix. Below are five random and surprising examples of what you can do to delight your clients. The key is the surprise element. If it’s not surprising it will become an essential and lose its impact. If your client expects something it won’t wow them nearly as much. So, give them a hand-written thankyou card thanking them for their custom and achievement; buy them movie tickets. And don’t be cheap – get gold-class tickets; give them a free product or service upgrade

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BUSINESS STRATEGY

CUSTOMER SERVICE

EXERCISE: CRITICAL NON-ESSENTIALS

Make them feel as if they are the most important customer you have ever served – because they are. Each and every client is vital to the ongoing success of your business or a voucher for a related business; take them out for a coffee, or lunch or dinner; send them a gift on their birthday (not a voucher for your business – this is not an opportunity to get another sale, it’s an opportunity to wow your customer). Now let’s have a look at how each of these fits into the Critical Non-essentials Matrix. If you have a look at the diagram you’ll see that we have ‘cost’ going from low to high on the vertical axis and ‘level of difficulty’ going from easy to hard on the horizontal axis. What you have to do now is fit each of these five bonuses for your customers into the matrix according to cost and degree of difficulty. You can see I’ve done it for the five examples.

Stefan Kazakis is a business strategist, sought-after presenter and speaker, and author of the new book, From Deadwood to Diamonds (Major Street Publishing, $29.95). He is a futurist and an inspiring communicator, with the voice of experience. For more information, please visit www.stefankazakis.com or email info@stefankazakis.com.

THE CNE MATRIX $$ 5 Birthday gift

4 Lunch/dinner

2 Movie tickets

3 Free upgrade

COST

1 Thank-you cards

$ EASY

DEGREE OF DIFFICULTY

Prepare a list like this for your business. You can use these five, or you can come up with five other bonuses that you think will be more appropriate for your customers. It’s also a good idea to work out a timeframe over which these events will occur, so as part of your plan you need to work out what actions you are going to take over a period of, for example, six months. Then draw yourself a diagram like the one above, and insert each of these items in the appropriate place. This matrix allows you to decide how you will use these five activities in your business. Thank-you cards are of course cheap and easy. Movie tickets

HARD

and a gift will probably cost a bit more but are also easy. A meal with a client takes a bit more effort, as does an upgrade. Your low-cost and easy ideas must be done often. There’s no excuse not to do them. The more expensive and difficult things can be done when appropriate, but they must still be done. Don’t think of these as a cost; think of them as an investment in the long-term success of your business. And once you have this system and culture in place, don’t think you need to stop at five – keep going! Keep coming up with new and inventive ways to delight your current and future customers.

www.mpamagazine.com.au

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18/03/2015 9:10:00 AM

12th ANNUAL

2015 RATE THE BANKS! Now is your chance to tell the banks what you think about their service and performance by taking part in MPA’s Brokers on Banks survey. Don’t miss the opportunity to have your say on lender performance. MPA’s Brokers on Banks survey has become known as the definitive banking report for the mortgage broking industry. The results of past surveys have inspired major lenders to benchmark their performance and identify areas of improvement in the third party channel, so why not give them something to think about by taking part? The results of the survey will be published in MPA issue 15.07 on desks in June. Don’t miss the opportunity to have your say on lender performance. Simply visit the website at www.mpamagazine.com.au and click on the banner.

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BUSINESS STRATEGY

RECRUITMENT

ONBOARDING:

FIVE TIPS TO GET THE BEST OUT OF YOUR NEW HIRES Onboarding is a critical yet often-overlooked aspect of bringing people into an organisation. Karen Evans shares her tips for engaging new employees and ensuring they stay with the business

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RECRUITING IS hard, but retaining talent is harder. According to research conducted by the Aberdeen Group, within the first six months in a job 86% of new hires make their decision to leave or stay. This astounding statistic should be at the front of every HR manager’s mind when they make a new hire. I’ve seen some of our customers lead the way in developing effective ways to ensure a successful, long-term hire. A well-developed onboarding program is a key part of this. Onboarding is, in a nutshell, a program ensuring that new employees are equipped with the necessary knowledge, skills and resources to become a valuable part of an organisation. It takes into account the professional but, just as importantly, the social aspects of beginning a new job. It begins before the employee’s first day and can continue for as long as the organisation and the employee need. There are five things you should keep in mind when developing a successful onboarding program.

Nobody knows what is needed better than an employee who has been through the system, whether it’s the newest graduate or a senior manager PROCEED WITH A PLAN OR STRATEGY IN PLACE A common mistake that managers make is to wait until problems arise, then deal with them accordingly. Many managers will teach the employee on a need-to-know basis. This is known as ‘onboarding on the go’. While this may seem like the easiest option, it means that an employee does not have comprehensive onboarding knowledge, and leads to a disruptive introduction to the company. Instead, develop and implement a clear strategy, and attempt to foresee any

www.mpamagazine.com.au

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BUSINESS STRATEGY

RECRUITMENT While many managers may think of the wider programs, such as setting up of email, submission of forms, and quarterly reviews, it’s vital to focus on the things that may seem trivial potential problems that may arise before the new hire starts.

TALK TO EXISTING EMPLOYEES Ensure that you talk to existing employees regarding areas in which your onboarding system may be lacking. Nobody knows what is needed better than an employee who has been through the system, whether it’s the newest graduate or a senior manager. It’s important to remember that onboarding is an end-to-end process. Speak to employees who have been through the system, and take their feedback on board. Ask open-ended questions about areas for improvement, and try to implement this in your onboarding programs.

PAY ATTENTION TO DETAILS AS WELL AS THE BIG PICTURE Take the time to organise all aspects of the onboarding process prior to the new

employee’s arrival, to ensure this is as streamlined as possible. While many managers may think of the wider programs, such as setting up of email, submission of forms, and quarterly reviews, it’s vital to focus on the things that may seem trivial. Does the employee know how to contact IT? Have they been formally introduced to their co-workers? While this may sound pedantic, your employee will be much happier if you cover all bases.

HAVE EVERYTHING READY TO GO ON THE FIRST DAY Make sure everything is ready for new employees when they start. Nothing is more disruptive for a new employee than stationery and paperwork arriving in dribs and drabs during their first few days. We recommend providing a ‘starter kit’ for employees, with everything they need, such as computer log-in, stationery and paperwork. This allows them to start personalising their workspace and to get up to speed as quickly as possible.

USE TECHNOLOGY Employers and HR managers should understand the value of technology during the onboarding process. This technology can range from internal communication, to automating contracts, documentation and payroll. Many managers have daily headaches over paperwork and organisation of new employees’ details, when in reality this can easily be automated and streamlined. By integrating systems, information gathered from the recruitment phase can be transferred to other systems that are designed to handle the administrative aspects of onboarding. This eliminates the administrative burden for you and lets you focus on the more important aspects of your job. Technology also allows you to report on the success of your recruitment and onboarding process, as well as to respond to any issues that may arise in the future. So whether you’re dealing with one new employee a month, or dozens, a welldeveloped onboarding process will help ensure a low turnover and high satisfaction for all staff, all while saving you time, effort, and money.

Karen Evans is the managing director at NGA.NET, a world leader in cloud-based talent management solutions.

www.mpamagazine.com.au

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17/03/2015 8:18:15 AM

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17/03/2015 8:32:44 AM

THE DATA

YOUR MORTGAGE TRENDS

BUYER TRENDS

Key stats from borrowers making enquiries at Yourmortgage.com.au AVERAGE LOAN SIZE REQUIRED $450,000

$425,000

$400,000

average loan amount

$375,000

$350,000 Feb 2014 Mar 2014

Apr 2014 May 2014 June 2014 Jul 2014

Aug 2014 Sept 2014 Oct 2014 Nov 2014 Dec 2014 Jan 2015

Feb 2015

$397,795

$407,900

$419,956

$412,758

$408,590

$403,466

$403,885

$405,300

$399,221

$419,153

HOW SOON MORTGAGE IS REQUIRED

$421,639

$407,522

$416,468

PURPOSE OF MORTGAGE 10.1% Move home

57% First homebuyer

70 60

30.6% Refinance to get a better deal

50 40 30 20 10 Feb

Mar

Apr

Not immediately

May

June

Jul

Aug

Sept

In the next few months

Oct

Nov

Dec

Jan

Right now! Hurry!

Feb

0.2% Other

0.2% Give my home a makeover

1.9% To buy an investment property

Visit www.mpamagazine.com.au/consumer-borrowing-data for all the latest borrower trends

www.mpamagazine.com.au

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FEATURE / BROKER EDUCATION LIFESTYLE

DAY IN THE LIFE OF…

Bridget Sakr, chief commercial officer, Genworth

5.30am: Every second week when I have the children I’m up at 5:30. I do one sit-up – as I get out of bed! The first thing I do is check for any messages, emails; I like to connect straight away. I check the weather site so I know what to wear for the day, then I look at my diary (all on my iPhone). 5.45am: Then I have a shower and get ready. Next, I make the kids’ lunches and pack their school bags. While I’m making the sandwiches I have 100g of yoghurt.

priorities for the week are discussed and any businessrelevant issues addressed.

10:30am: I catch up with Kate, my assistant. We go through the week ahead to see what it looks like and see if anything requires attention or needs to change. 11:30am: Attend weekly project meeting for our new eLMI Portal that streamlines the delivery of LMI applications.

executive team to discuss the year ahead and strategically what we will be doing to help them achieve their goals and objectives.

4:00pm: Next I meet with a major bank customer’s chief operating officer to focus on risk management strategies. 5:00pm: I check into the hotel and get ready for dinner. I speak to my children,

6:45am: I get the kids up, get them dressed, and while my son Michael, who is eight, has breakfast, I make their beds. The house is always spotless before I leave. My daughter Veronique, six, has her breakfast in the car.

7:30am: We are out the door and head from the Eastern Suburbs to the Southern Suburbs. Our car ride is our time as a family where we catch up. We play ‘I Spy’, and there’s no ‘i’ world in the car (iPhones, iPads). It’s our ‘we time’. 8:15am: Drop off at school and begin the trip back from the Southern Suburbs to North Sydney. I try to maximise my time in the car by getting on the phone. I’ll speak to my staff, customers or have internal Genworth meetings. By the time I get to work I have done an hour and a half of driving and feel like I’ve lived a whirlwind!

9:00am: We have our weekly commercial meeting with my direct reports, where

“I meet with the chief risk officer from a regional bank customer for dinner, and there goes my 500-calorie count out the window!” 12:30pm: I often grab a sandwich downstairs, and by the time I’m back at my desk I would have eaten it in the lift on the way back up, but today I am flying to Melbourne for meetings. I would usually grab something from the business lounge before I board, but I’m not hungry. I try to do the 5/2 diet by Dr Michael Mossley, and Wednesday is usually a 500-calorie day!

make some work calls, and respond to emails.

6:00pm: I meet with the chief risk officer from a regional bank customer for dinner, and there goes my 500-calorie count out the window!

9:30pm: Dinner finishes up and we have a drink in the hotel lobby.

1:00pm: On the plane I read the paper or

2:30pm: I head straight from the airport

10:00pm: I head back to my room and catch up on emails from the day, make some more calls, and speak to a girlfriend that’s just come back from overseas.

to a meeting with one of our regional bank customers’ chief financial officer and their

12:00pm: Lights out and I hit the pillow.

work material; at night a lot of my reading is work material.

www.mpamagazine.com.au

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THE DATA

FINANCIAL RESULTS

FINANCIAL RESULTS: AN EMOTIONAL ROLLER COASTER For all the hype, it’s money that really talks. These snapshots of companies’ 2014 half-year results speak volumes about the market’s dynamics and what the future holds FINANCIAL RESULTS aren’t, understandably, of too much interest to mortgage brokers – we’re not ‘that’ type of broker, after all. But while shares might not be your bread and butter, financial results do provide a fascinating insight into the industry’s and market’s performance, one that is backed up by actual profit and loss figures rather than hype. Whether good or bad, companies are expected to explain their results, and this supporting data can be valuable to the neutral observer. Early 2015 saw ASX-listed companies release details of their financial results for the second half of 2014, ie the first half of the 2015 financial year. We’ve looked closely at the published results of a number of companies, including Commonwealth Bank, Mortgage Choice, and Bendigo and Adelaide Bank. Make no mistake: 2014 was a good year across the industry. However, you shouldn’t just look at total profits; you need to look at the sources of profit, whether they’re growing or shrinking, and whether they’re sustainable in the long term. Comparing market share and individual growth rates with system growth is also an important way to distinguish the leading companies in a growing market. We’ve picked out a few individual insights which we think say a lot about the mortgage industry – but we also encourage you to go online and draw your own conclusions.

RISING PROFITS A verdant island in the stagnant swamp of the Australian economy, the housing market is producing significant profit increases for many players. For net profit after tax, compared to the profits in the equivalent period in late 2013:

up 10.9% up 8.8%

up 3.3% Mortgage Choice

Commonwealth Bank

Bendigo and Adelaide Bank

www.mpamagazine.com.au

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POSITIVE PREDICTIONS: ECONOMIC RECOVERY Firms hope a general recovery in the economy will further bolster the mortgage industry. CBA notes there are “some signs of positive transition in [the] Australian economy: reality [is] ahead of sentiment”

SYSTEM GROWTH AND MARKET SHARE Market share can be viewed in a number of ways: share of all mortgages, share of third-party business, or by comparing growth to system growth. Looking at this a very different picture emerges: 8% 7% 6% 5% 4% 3% 2% 1% 0%

System growth

CBA’s home lending Bendigo and balance growth Adelaide’s lending balance growth

CBA attributed this result to being “Underweight in higher growth segments – broker and investment lending”

Mortgage Choice’s data on the share of mortgage settlements among different lenders shows:

Majors Non-majors Credit unions

3% 7% 3%

CEO Michael Russell noted that non-majors struggling to maintain consistent turnaround times had played a part in this: “There is more consistency in the industry, but we still see blowouts…professional brokers are on top of turnaround times; and if they [the banks] blowout, they will lose flow”

SPECIAL OFFERS Late 2014 saw lenders offer some highly competitive commission incentives for brokers. However, good things don’t last forever, with consequences for future growth. For example, with trail income, Mortgage Choice is expecting a short-term boost, followed by stability: 0.200%

LOO

KIN

NEGATIVE PREDICTIONS: FORCED COOLING

0.175% 0.150% 0.125% 0.100%

1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20

BED noted that “Whilst demand for housing loans is solid we are seeing an increase in customers paying down their debt across all portfolios”

Average rate total book (Actual) Average rate total book (Estimated) Average rate new settlements

Some are worried that regulators will step in to cool the market. Mortgage Choice saw regulation as a “contingent headwind: that is the jawboning being undertaken by APRA at the moment, to really contain the level of growth in investment lending … we certainly hope that continues to be jawboning only”

Source: Commonwealth Bank Media Presentation for the Half Year Ended 31 December 2014 / Mortgage Choice Half Yearly Results Presentation / Australian Broker, ‘Regional lender records weak mortgage growth’ www.mpamagazine.com.au

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LIFESTYLE

FAVOURITES

FAVOURITE THINGS John Kolenda, director, Finsure

I enjoyed playing tennis from a young age and even went on to get my Level 2 coach’s certificate to help my daughter, who showed promise as a junior. I thought, if I was going to add value screaming from the sidelines, I should know what I was talking about. Tennis was a sport I was pretty good at as a teenager. Completing the Level 1 and 2 courses I felt like I was back at uni, and it was difficult at the time when I was building a mortgage aggregation business. I did get through it and thought I would leave the Level 3 coaching course to the professionals. I occasionally get a chance to play golf, but golf is a little harder to find time for, as it does consume the whole day – plus I’m not that good at it.

I love a BBQ on a Sunday; love it when the family gets together. We have an open-door policy on Sundays: if you are around, pop in for a BBQ. I must say, I have a reputation around Australia for cooking an amazing BBQ, and it’s something I have worked on for years. A great way to entertain and enjoy people’s company.

Love reading the Robb Report as it’s inspirational. They interview famous people and showcase the world’s most expensive toys, houses, boats, watches, and many other luxury items. I love reading the Financial Review each day because it keeps me up to date with the latest business and economy developments.

Water polo is a game I have learnt a lot about over the past few years as my teenage son is right into it. I must say I am really enjoying it from a spectator’s point of view as it’s fast-paced and physical, very much like rugby in water. I once thought of doing the water polo coaches course … maybe … who knows? I don’t think you can ever stop learning.

I also relax some evenings at home, enjoying action movies. My kids and I get our snacks and drinks together before sitting down to an entertaining night. My favourite movies of all time include Terminator 2, Fried Green Tomatoes, The Girl with the Dragon Tattoo, the Bond movies, Die Hard, Lord of the Rings … Boy, there are too many ... But I’m not into horror movies.

My family and I really enjoy the summer weather and prefer to stay around Sydney during the Christmas period and travel overseas chasing the sun during winter. Best destination we have been to is Bora Bora, and I would highly recommend it! You won’t ﬁnd me on top of a mountain with skis on as I can’t ski and don’t like the cold.

www.mpamagazine.com.au

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16/03/2015 3:27:28 PM

"Winning the AMA Brokerage of the Year is the ultimate recognition of the hard work our staff do every day, the loyalty of our clients and the depth of relationships we hold with our business partners and suppliers. In an incredibly competitive industry this recognition allows us to stand alone and cement our brand and reputation with existing clients and alliance partners while bringing in new business that comes with being named AMA Australian Brokerage of the Year." Jason Back, Managing Director, Australian Lending & Investment Centre 2014 Australian Brokerage of the Year

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