Mortgage Professional Australia issue 16.10

MPAMAGAZINE.COM.AU ISSUE 16.10

SEEKING PERFECTION From our Brokers on Aggregators survey to our livestreamed roundtable, we’re on the lookout for the perfect aggregator

2016

AUSTRALIAN MORTGAGE AWARDS

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OCTOBER 2016

CONNECT WITH US

CONTENTS

Got a story or suggestion, or just want to find out some more information? twitter.com/MPA_Australia facebook.com/Mortgage ProfessionalAU

UPFRONT 04 Update

Refinancing, bank spying, attitudes to debt and more

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FEATURES

TACKLING THE BIG ISSUES

What non-majors are doing to improve turnaround times, BDMs and credit policy

AGGREGATOR ROUNDTABLE

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Gadens partner Elise Ivory on the legal issues surrounding customer referrals

10 News analysis

After the election: what Turnbull’s ‘victory’ means for broking

MORTGAGE INSIDERS

64 Zaheer Lalani

40 Construction finance specialist on credibility, products and podcasting

08 Opinion

Talks MPA through her journey from banker to broker to MFAA chairman

ASIC, foreign buyers, IT – all covered in our third Aggregator Roundtable

DANIEL HOLDEN

Three brokers on how they market their brokerages

62 Cynthia Grisbrook

FEATURES

BROKER PROFILE

06 Head to head

YBR broker on why he spent his wedding feeding the world’s poorest people

FEATURES

BROKERS ON AGGREGATORS

Our survey returns for 2016 with new questions and new insights

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MPAMAGAZINE.COM.AU NOW ONLINE: Highlights from our livestreamed aggregators roundtable

FEATURES

Advice and expertise from MPA’s High Performance Business Summits

We announce the shortlist for the Australian Mortgage Awards

Top brokers and brokerages in Leading Mortgage Professionals

AMA FINALISTS

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EDITOR’S LETTER www.mpamagazine.com.au

TRADE SECRETS

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he smell of coffee; that bowl of Mentos; unused notepads – all industries have summits, and a broking summit looks much the same. The difference is what’s being said on stage. We recently ran our second High Performance Business Summit, this time in Melbourne, where Victoria’s AMA winners, Top 100 brokers and leading commercial brokers told the audience about the strategies and practices that had made them successful in broking.

It may sound counter-intuitive, but this degree of openness is quite unusual.

Most business summits are about highlighting one’s achievements (and possibly lining oneself up for a new corporate job), and not revealing trade secrets. It’s no coincidence that the vague terms ‘innovation’ and ‘thought leadership’ have come to define our business discourse. Rarely do speakers define what they actually mean by these terms, because they don’t want to.

Our brokers, on the other hand, were incredibly practical and specific, whether discussing their plans for starting their business, what had worked and what had failed, or their point of difference compared to other brokers.

All this, addressed to a roomful of their competitors.

It’s no coincidence that the vague terms ‘innovation’ and ‘thought leadership’ have come to define our business discourse What makes brokers, unlike other industries, willing to give away trade secrets? Perhaps as a relatively young industry, with approximately 47% market share still up for grabs, there’s less reason to be competitive, but of course many top brokers are highly competitive, which is why MPA’s ranking reports (Top 100, etc) attract so much attention.

It’s my belief that brokers are confident in talking about their business because they truly know it inside out. Unlike CEOs of huge multinationals, most brokers built their own firms, know their staff, are justifiably proud of what they’ve achieved, and are sympathetic to up-and-coming brokers in their position. There’s no need to waffle on about ‘innovation’ when you can define exactly when and what took your business to the next level.

Sam Richardson, editor, MPA magazine

OCT 2O16 EDITORIAL Editor Sam Richardson Journalist Maya Breen Production Editor Roslyn Meredith

ART & PRODUCTION Design Manager Daniel Williams Designer Loiza Caguiat Traffic Coordinator Lou Gonzales Freya Demegilio

SALES & MARKETING Publisher Rajan Khatak Account Manager Simon Kerslake Marketing and Communications Manager Lisa Narroway

CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley Managing Director Justin Kennedy Publisher Rajan Khatak Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil

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tel: +61 2 8437 4787 sam.richardson@keymedia.com.au

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ADVERTISING ENQUIRIES

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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 the magazine can accept no responsibility for loss.

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UPFRONT

REFINANCING NEWS BRIEFS Liberty joins AFG top 10 Non-bank lender Liberty Financial has beaten non-major banks to be ranked ninth in AFG’s Competition Index.

Over March, April and May 2016, Liberty accounted for an average of 1.9% of AFG’s business, beating ME at 1.3%, and sitting behind AMP at 2.5%. While Liberty comprises a small percentage of lending compared to the major banks – who together account for 64.2% of lending – the biggest non-major, Suncorp, only wrote 5.4% of loans over the period.

Liberty’s national sales manager John Mohnacheff said Liberty was taking market share from the banks: “With APRA increasing bank lending regulation in late 2015, Liberty was well positioned to capture a large share of new loans and has seen positive and responsible growth as a result … We’ve seen deal flow increase right across the business. For some of our product lines, it grew close to fivefold during the last year.”

Final cut as RBA’s Stevens departs After 10 years and 4.5% worth of rate cuts, RBA governor Glenn Stevens is leaving the role – but not before cutting rates to just 1.5% in August. The self-proclaimed ‘boring bloke’s’ final act was driven by disappointing inflation figures, the resilience of the Aussie dollar and cooling house price growth, according to CoreLogic head of research Tim Lawless.

Stevens will be succeeded as governor

by Philip Lowe on 18 September. Since 2012, Lowe has essentially been Stevens’ deputy, but the challenges he faces will be immeasurably different to those faced by Stevens when he took on the role in 2006.

For a start, rates could still go lower than 1.5%. Thirty-four per cent of a panel of experts brought together by Finder.com.au believed another rate cut could occur in 2016.

In Stevens’ final speech, to the Anika

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Foundation, he warned the audience that “we can’t just assume that monetary policy can simply dial up the growth we need. We need some realism here”. He argued that any global economic recovery would take a very long time and thus “normal is a different place now”. Cutting rates ultimately depend on institutions to take on debt and spend, said Stevens, yet “there is a limit to how much we can expect to achieve by relying on already indebted entities taking on more debt”.

Stevens insisted he was not simply advocating for an increase in government spending, although he did suggest the conversation about the deficit was too focused on government debt while ignoring private debt.

Bank ‘spying’ on business customers NAB has been using Veda alerts to track when its business banking customers are looking to borrow elsewhere, Fairfax reported in July. The major bank confirmed that it uses the reports from the credit rating agency and other sources: “It’s important our bankers keep in touch with their business customers, especially when they are taking out new lending with other institutions, to understand the intent of the finance and how it will impact on their business operations.”

FBAA CEO Peter White said the revelations could help brokers. “There are still serious privacy concerns surrounding this use of information, as the banks look to keep a tight grip on their customers.” Brokers can keep financial details at ‘arm’s length’ from the lender, White added. “It is important brokers get the message across that customers have every right to refinance or apply for a new loan without having a bank accessing personal information which they have no right doing.”

VEDA’s marketing subsidiary Inivio is currently being investigated by the Office of the Australian Information Commissioner after a customer alleged it had sold her data to ANZ and other lenders.

DEBT AND FEAR Despite historically low rates, Aussies are increasingly concerned about their finances, a new report from ME suggests Average household financial comfort is declining, according to ME’s Household Financial Comfort Report, released in June.

ME’s comfort index fell below its historical average, with all 11 index components declining, particularly respondents’ ‘ability to handle a financial emergency’, ‘comfort with income’ and ‘cash savings’.

Most relevantly, 10% of respondents believe they won’t be able to meet debt commitments over the next six to 12 months, 33% will ‘just manage’, while respondents’ perceived ability to buy and pay for housing has fallen by 9%.

Aussies believe their finances are getting worse, but on paper (and, notably, on average) they’re getting better. Household net worth is improving and the rise in household debt is easing: from 7.4% in 2015 to 6.9% in May 2016. Interest rates are at historic lows, with banks offering better deals to owner-occupier customers as they look to move away from investors.

To understand what’s concerning their clients, and whether those concerns are justified, brokers need to take a deeper look at these results and what they mean for different households.

Generationally speaking, the confidence of baby boomers fell most, 45% of whom expected to be worse off after the federal budget, with concerns centring on retrospective changes to superannuation. Nevertheless, Gen X respondents, and particularly single parents, continue to be the most concerned generation.

Concern about job security and income may be well founded. While the unemployment rate has remained stable in 2016, the number

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of hours worked has “declined significantly”, according to the report, reflecting a shift from stable full-time employment to part-time and casual work.

Casual and part-time self-employed workers were understandably the most concerned groups. Interestingly, full-time self-employed workers were the least concerned about their finances.

Additionally, perceptions of job availability are also falling, with baby boomers and older couples the most concerned.

There are several surveys on consumer confidence other than ME’s. In 2016 the ANZ Roy Morgan Consumer Confidence index has actually been above its long-term average, for instance. It’s possible that debt is simply perceived more negatively than before, perhaps connected to how extensively government debt has been discussed in the mainstream media this year.

Either way, brokers, financial planners and accountants have a role in showing Australians what their financial situation actually looks like, as opposed to what they might think it looks like.

REFINANCING Aaron Milburn State general manager, NSW/ACT WESTPAC

Fast fact Refinancing fell in May and June 2016, which CommSec attributes to refinancers holding on for further rate cuts.

What are the main motivations that make consumers switch lenders?

There are a range of triggers for consumers to switch lenders, including change in circumstances, media commentary, a referral, or, most frequently, poor service or lack of personal service. Every consumer is different. When I started in mortgage broking in 2009 I was told of a deal called a ‘vanilla transaction’ – a deal that just fits the mould with no anomalies. I’m yet to see one. I am yet to see one because each client or family is different and requires an individual solution. The brokers and lenders that are able to recognise this will see consumer volumes and NPS scores grow substantially.

How can a broker market refinancing to consumers outside their existing customer base?

The best way for a broker to do this in my view is to diversify; to offer that whole financial solution. whether that be from themselves personally or their network of contacts. For a consumer like myself the ability to do everything in one place with one person is a real selling point. It’s also valuable because it saves the consumer time. In an ever-increasingly busy world, time-saving is a true and measurable commodity. Referral by existing clients again is a sizeable opportunity – those that have their back book marketing for them and advocating for them will drive opportunity.

What is Westpac doing to attract consumers who want to refinance their home loans?

Westpac is a bank with a history of helping Australians achieve their financial goals and dreams, and this remains our top propriety as we approach our 200th anniversary. We are a bank that provides not only competitive home loan solutions but one that will work to offer our customers a financial solution that fits their needs – whether that dovetails to what the broker has suggested from our product suite and service offerings or our various other channels consumers can interact with. It’s not a one-0 product solution at the Westpac Group. For us it’s about assisting in achieving our clients’ goals and aspirations now and into the future.

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UPFRONT

HEAD TO HEAD

What are your best marketing strategies?*

Rose M De Rossi

Daniel Niederberger Director Value Finance

Franchisee Mortgage Choice NSW

Like most finance brokers that have been in the industry for any amount of time, we have tried and tested many forms of marketing. There are a number of strategies that we did not have success with, mainly cinema advertising and radio. You can spend thousands of dollars a month with no return. That is not to say that it wouldn’t work for others, but this is definitely something we will not be trying again.

In terms of branding, we are just about to unveil our new billboard. It is the first time we have done this and understand that it may not drive traffic to our site immediately, but at least we are planting the seed. I would suggest engaging a marketing company to design the artwork; they are the experts.

Our monthly newsletter in conjunction with Facebook is very successful. We try to carry the same theme throughout all marketing posts and articles. And don’t forget your clients; they are the best source of referrals money can buy ‌ or not buy!

Our clients are happy to refer and we have a number of trigger points to remind them of how we work on a referral basis.

Still being a small and relatively young business, Value Finance favours digital marketing channels, using client-led insights to create content and encourage engagement with our brand and our brokers. We find that both our existing and prospective clients appreciate this approach and it allows us to demonstrate a level of care, as we provide ongoing education about issues that affect a broad range of our clients.

In addition, we believe in a genuine and personal approach, and endeavour to connect with our clients and/or leads at every opportunity. We leverage our CRM system where possible to facilitate this ongoing contact in a way that allows us to add value to people, rather than sending them the occasional email.

In saying that, tailored messaging via email marketing is set to become another part of our channel strategy we will roll out in the coming months. Our overall objective is to utilise our digital channels to continue to raise brand awareness and consolidate relationships with our existing customers.

I have a few marketing strategies that I employ, including monthly personalised newsletters to my database of existing customers and client prospects.

These newsletters include relevant industry content that I know my clients and prospects will find interesting.

I send different content to my different customers, depending on the stage of their financial journey they are currently in (first home buyer, upgrader, investor, refinancer, etc).

In addition, I am active on social media, including Facebook and LinkedIn, and promote my brand through various advertising activities within my local area.

Finally, I am heavily involved in my local community and regularly help out at carnivals and sporting events.

In this business, it is important to be approachable and memorable. The more people that I speak to and who know what it is I do, the more likely I will be to generate business opportunities.

Director Diversifi

James Slattery

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UPFRONT

OPINION

THE DANGERS OF REFERRAL SELLING Gadens partner Elise Ivory explains why offering your customers rewards in order to refer others can get you in trouble with the law

CUSTOMER REFERRALS as lead generators are good for business, right?

Cheap commissions; efficient as once the referral is made you deal directly with the customer; and the more referrals you have, the more leads you can generate (equally, more customers and more profit for you).

And isn’t it even better if you can get your customers to do the heavy lifting for you?

Most potential customers would value the opinion of someone who has used your services and been happy with the result over a business referrer with a vested interest in sending customers your way.

But have you ever asked customers to refer family and friends and offered some kind of incentive for doing so? Perhaps you have offered them a discount off other services you offer, movie tickets, a rebate on the commission they paid, or maybe just a cash incentive? If so, you need to be aware of s49 of the Australian Consumer Law which prohibits ‘referral selling’.

Section 49 of the Australian Consumer Law (which is a schedule to the Competition and Consumer Act) states: A person must not, in trade or commerce, induce a consumer to acquire goods or services by representing that the consumer will, after the contract for the acquisition of the goods or services is made, receive a rebate, commission or other benefit in return for:

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(a) giving the person the names of prospective customers; or (b) otherwise assisting the person to supply goods or services to other consumers; if receipt of the rebate, commission or other benefit is contingent on an event occurring after that contract is made.

may not eventuate (ie the family and friends may not obtain services from the broker). This conduct is illegal because neither the borrower nor the broker can control the outcome. A consumer should not be sold something on the basis that they will only receive a reward if something else occurs.

What may not amount to referral selling is if the broker provides the incentive to the borrower regardless of whether the family or friends take up the broker’s services (that is, the borrower will benefit just from providing the names of family and friends with no conditions attached).

Similarly, a broker may be able to offer a reward for signing up family and friends after the borrower has already obtained the services of the broker. For example, once a broker has provided a borrower with credit assistance and that borrower’s loan has settled, the broker may be able to contact the borrower and say, “If you are happy with the services I provided, please tell your family and friends, and if they take up my services, you will be rewarded.” In this case the borrower has already obtained the services of the broker and so the reward is not acting as an inducement

As the penalties for breach of the section are hefty – $1.1m for a body corporate and $220,000 for an individual – getting this right is vital Put more simply, a business cannot entice customers to purchase goods or services from them by promising the customer a reward on the basis that they refer other customers and those customers take up the services of the business.

Take, for example, mortgage brokers providing credit assistance to a prospective borrower. As part of their sales pitch brokers cannot tell the borrower that if they refer family and friends they will receive a share of the commission that the broker receives from the lender if their family and friends also procure the services of the broker. In this instance the borrower is being enticed to obtain the services of the broker due to promises made that may or

for the borrower to use that broker; it is merely a value-add.

However, as the penalties for breach of the section are hefty – $1.1m for a body corporate and $220,000 for an individual – getting this right is vital, therefore we recommend obtaining expert advice before offering any type of incentive to customers for providing referrals.

Elise is a partner in Gadens’ Financial Products and Services group at Gadens, where she works as part of the Regulation and Compliance team.

She advises banks, aggregators and brokers on consumer and commercial credit regulation, compliance, distribution and licensing.

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NEWS ANALYSIS

GOVERNMENT POLICY

WINDS OF CHANGE FROM CANBERRA What is next for the housing market since the Coalition Government held on to its majority by the thinnest of threads? Maya Breen reports

AUSTRALIA’S 2016 federal election took place on 2 July. But it wasn’t until eight days later that the double dissolution election, the first since 1987, was declared won by the Coalition, narrowly avoiding a hung parliament.

With all the votes counted, Prime Minister Malcolm Turnbull now leads with a one-seat majority government and the closest federal majority result since the election in 1961. The man he had just beaten, Bill Shorten, had been loudly calling for a Royal Commission into misconduct in the banking and financial services industry. Turnbull’s victory was meant to bring a return to stability – yet the aftermath has been anything but.

Following a cash rate cut in August to a record-low 1.5% – a figure that was not passed on in full by lenders – Turnbull announced in early August that major banks would appear before a parliamentary panel once a year to explain their decisions on interest rate changes. Mainstream media reported in midAugust that NSW Nationals senator John Williams and Queensland Liberal Warren Entsch were in support of a banking tribunal.

This would enable those who could not fund themselves through the courts to take action, and could prove more effective than a lengthy Royal Commission, although Labor are continuing to make the case for one.

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Reporting season for the banks, while mixed in terms of results, has continued to produce profits that look increasingly at odds with the state of the wider economy.

Consumer confidence in the property market is at a three-year low, at levels not seen since December 2013, according to a June ANZ/ Property Council survey, and leading industry members have urged Turnbull to focus on housing and called for a federal minister for housing to address key issues such as housing

“Reform is the key, while procrastination could well be the nation’s Achilles heel. A lack of federal focus on housing policy reform increases the chance of a ratings downgrade” Harley Dale, HIA affordability and supply and demand.

The election was meant to stabilise the housing market, but as MPA has found, it’s doing quite the opposite.

Housing affordability Affordability was always going to be an election issue. Indeed, commentator Alan Kohler declared in The Australian in March

that “the election is a referendum on house prices”, with the Labor Party looking to reduce house prices and the Liberals looking to reduce labour costs.

“Housing affordability is the result of there being insufficient supply of housing.

You need to have more supply of housing,” Turnbull told the press earlier in the year as the federal government pledged to work with

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AUSTRALIA’S HOUSING AFFORDABILITY CRISIS AT A GLANCE

House prices are at record highs…

House prices have risen at an average rate of around 7.5% p.a. since mid-2012.

The national median dwelling price rose to $495,000 in the June 2016 quarter.

But income has stayed quite level…

Annual wage growth is at an 18-year low of 2.1%; year-on-year house price growth across the capital cities is at 6.1%.

state and local governments to open up land to developers so that, with more houses, rising prices would slow.

Real estate giant LJ Hooker’s CEO, Grant Harrod, said that, overall, the re-elected government would be a positive for the property market as more properties become available and consumer confidence turns around. With record-low interest rates and the stability of a continuing government, he expects the remainder of the year to see buyers swarming the market.

The FBAA’s CEO, Peter White, agrees with Harrod but says unemployment is a key factor.

“It’s good to have the stability – there’s no point getting a short run at something; you never get anywhere,” he said. “The biggest challenge we’ve got is getting things through the Senate – trying to get motions through

the Senate is still going to be as difficult as it was in the past three years.

“To solve the housing situation, you’ve got to try and bring unemployment back under control, get inflation right and encourage the growth of the country and business. If business isn’t stimulated then you don’t have the employment opportunities, and if people don’t get employed they can’t buy houses.”

Minister for housing A leading housing association and a leading real estate company have both called for more attention to be paid to the property market at a federal level. Housing Industry Association (HIA) chief economist Harley Dale said a national focus on housing was vital to maintaining Australia’s AAA credit rating.

“Residential building activity has been

Leading to first home buyers finding it especially hard to get a toe on the property ladder…

About one in seven owner-occupier buyers are first home buyers.

The number of first home buyers as a percentage of total owner-occupier housing finance commitments fell again (down to 13.9% in May 2016 from 14.4% in April 2016) and year-on-year from 15.6% in May 2015 to 13.9% in May 2016.

Sources: ABS housing finance data, May 2016; RBA August Statement on Monetary Policy 2016; HIA Affordability Report, June 2016 quarter; CoreLogic; Australian National University; CommSec

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FEATURE / BROKER EDUCATION NEWS ANALYSIS

GOVERNMENT POLICY the engine room of the Australian economy for the past four years,” Dale said.

“The incoming Commonwealth government needs to focus on building the new homes for our growing population.”

This would address housing affordability challenges faced by younger generations and help businesses across the residential

Harrod said a minister for housing should be appointed to oversee not only housing affordability but also supply and demand, foreign investment and property taxes.

The FBAA’s White said federal level involvement was important, but working together with state governments under the right structure was equally crucial. He also

“We are confident banks can explain why the interest rates they set for borrowers are determined largely by the costs of funds and the pressures of a highly competitive market, not the Reserve Bank cash rate” Steven Münchenberg, ABA building industry to grow and support the Australian economy.

“Australia needs a Commonwealth housing minister – a senior minister in cabinet to provide national leadership, to coordinate federal, state and local government housing programs, to guide important industry policy reform nationally, and ensure housing has a front seat in cabinet discussions around taxation reform, national budget repair, infrastructure and workforce development,” Dale said.

Other countries have dedicated ministers for these issues, such as New Zealand’s Nick Smith, who is Minister of Building and Housing and Minister for the Environment, focusing on housing affordability and construction issues.

“Reform is the key, while procrastination could well be the nation’s Achilles heel. A lack of federal focus on housing policy reform increases the chance of a ratings downgrade,” Dale said.

LJ Hooker’s Harrod agreed that it was high time a minister for housing was appointed, and said more influence from a federal level needed to be combined with local and state government efforts to overcome concerns around housing affordability.

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said that, on the flipside, first home buyers also needed to be sensible about what they could and couldn’t afford and might need to look further afield for their first houses.

“That’s really the key – without affordable housing no one gets into the market, but the balance of that is that buyers have also got to be realistic in what they can and can’t do.”

Summoning the banks The Reserve Bank’s further reduction of the official cash rate in August from 1.75% to a record-low 1.5% was the first easing since May, when it dropped from 2% to 1.75%.

What has caused a stir this time around, however, is that none of the major banks passed on the cut in full to their customers, spurring Turnbull’s announcement in early August that major banks would face regular scrutiny from a parliamentary panel on their interest rate decisions, at least once a year.

“This is an important step, a permanent change in the regular financial calendar that will require the banks to become accountable,” Turnbull stated.

The banks have welcomed the invitation but are defending their decisions on interest rate changes. National Australia Bank CEO Andrew Thorburn said in a statement: “I

have indicated to the Treasurer I will accept the invitation to attend the Committee and discuss the way we balance the needs of all stakeholders, including borrowers, depositors, investors and shareholders.

“We believe our key responsibility is to help people with important financial decisions and to build a stronger economy.

The needs of these stakeholders need to be carefully balanced, in order to sustain their support over the long term. A bank is no different, and indeed it has been my experience over 30 years in banking, that this balance is both vital and difficult.”

In a response from the Australian Bankers’ Association (ABA), chief executive Steven Münchenberg said: “We are confident banks can explain why the interest rates they set for borrowers are determined largely by the costs of funds and the pressures of a highly competitive market, not the Reserve Bank cash rate.

“Since the start of the global financial crisis over eight years ago, the Reserve Bank’s cash rate has not mirrored the actual funding costs of banks. Banks have explained repeatedly why the Reserve Bank does not set interest rates.

“About two thirds of bank funding comes from deposits, and banks have raised interest rates on a range of those deposits, even as the Reserve Bank cut the cash rate,” said Münchenberg.

He said the ABA welcomed the opportunity to address concerns around bank practices, but that when banks made their rate choices it was a balancing act between the needs of borrowers, savers and shareholders.

“As well as higher deposit costs, we have seen increases in banks’ short-term funding in wholesale markets. Banks also have to build their capital to withstand any future shocks, which adds further pressure on their margins,” Münchenberg said.

ANZ chief executive Shayne Elliott explained that the bank had passed only half of the cash rate cut on to customers in order to pay more to their savers.

1300HomeLoan managing director John Kolenda said he expected the major banks to

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FEATURE / BROKER EDUCATION NEWS ANALYSIS

GOVERNMENT POLICY hike their interest rates now that the federal election was over.

“Major lenders have been assessing options to reprice but have delayed making any moves due to the attention put on them by both political parties and awaiting the outcome of the federal election,” he told MPA’s sister publication Australian Broker.

“Banks will be eyeing repricing opportunities and look to lift rates out of cycle some time in the second half of this year now the election is out of the way.”

In the shadow of the commission As the banks and the government lock horns, Shorten and his Royal Commission are waiting in the wings. Indeed, the Labor leader reignited his campaign in early August, using

“There needs to be transparency.

The whole industry is under the microscope at being transparent – even the broker market” Peter White, FBAA the release of the banks’ record-breaking profit reports in support, as Commonwealth Bank revealed its annual profit of nearly $9.5bn.

Shorten said the banks needed to be investigated if they chose to put profits and executive rewards before customers, according to the Australian Financial Review, but the banks have retaliated, claiming that Labor’s steps will only hurt shareholders,

PASSING THE BATON The RBA governor of 10 years, Glenn Stevens, will step down on 17 September and his successor Philip Lowe will take up the helm the following day.

Philip Lowe is the current deputy governor of the RBA, deputy chair of the Reserve Bank board, and chair of the Reserve Bank’s risk management committee.

Stevens welcomed Lowe, saying, “It is a superb appointment. There could be no one better qualified than Phil Lowe to lead the bank through the next seven years. The bank will be in the very best of hands.”

The central bank chief “negotiated a once-in-a-century mining boom without blowing up the economy”, according to Bloomberg; navigated the country through the global recession and oversaw average inflation of just 2.5% throughout his 10 years. Lowe will be the first governor in 40 years to tackle the challenges of low inflation, and with the cash rate at a record-low 1.5%, it is an unenviable task.

Read more about the new RBA governor in the next issue of MPA, 16.11

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superannuants and depositors.

“There’s a culture in banking which puts the profits of banks, big profits, billions of dollars of profits ahead of the national interest and interests of mum-and-dad mortgagees, small businesses and people with large credit card interest rate debts,” Shorten told the paper.

The FBAA’s White wasn’t previously in support of a Royal Commission into banking, but his stance has changed since the latest rate cut was not passed on fully, and he added that whether the banks passed on the full cut would depend on the environment.

“There needs to be transparency. The whole industry is under the microscope at being transparent, even the broker market,” said White. The banks especially need to be “extremely transparent”, he said, because of their power over the economy and marketplaces.

The MFAA told MPA that “any major review into the wider financial services sector needs to acknowledge the positive role of brokers and ensure that consumers continue to have access to a competitive, ethical and available service.” They did not take a view on whether a Royal Commission was necessary or not.

With the politicians pressuring the banks on transparency and the industry pressuring the government on housing affordability, the property market is certainly in the political conversation for now. The question is how long will the government resist pressure to give it a more permanent place at a federal level?

If the industry unanimously keeps the pressure on government to better its efforts around housing affordability in its new term than it did in its last few years, the outcome can only be a positive for brokers.

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PROFILE

DANIEL HOLDEN

DANIEL HOLDEN: A MILE HIGH The award-winning director of HoldenCAPITAL isn’t just making a name in construction finance; he’s redefining what a specialist brokerage can be

IN TODAY’S third party channel, experience is welcome, but niches are not. Expansion is generally equated to diversification – tapping additional revenue streams in order to shield yourself from market downturns.

The HoldenCAPITAL team are doing the opposite: building a giant within the niche construction space. They are brokers but also lenders, mortgage managers and fund managers, a combination that has been recognised by the industry and beyond: director Daniel Holden was a finalist at the Australian Mortgage Awards and his brokerage also made Business Review Weekly’s coveted BRW 100 Fast Starters list. HoldenCAPITAL is an innovative business working in a niche space, and is also an example of just how far disciplined specialisation can take a brokerage.

“There are other revenue streams we could pursue if we wanted to balance out the ups and downs of the property cycle,” says Holden.

“However, all of our guys are long-term operators in the development space, whether they’ve come from property or traditional banking … we only do construction loans and we only deal with developers. In that way it’s knowledge an inch wide and a mile high in the construction sector.”

Holden’s clients – multi-unit developers – are a group with a natural need for brokers in order to secure finance for long-term, complicated projects. Moreover, this need has increased sharply in recent years as banks have tightened criteria in this space.

Whether willingly, through limiting lending for apartments amid concerns over oversupply, or unwillingly, through taking months to

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process applications, banks are losing out in the space to more nimble and specialised non-bank operators. Holden has seen this first-hand: “FY15 we did $224m of loan settlements for the year, and 64% of that was major banks. FY16 we did $340m and 28% of that was major

had moved out of the space he was working in, so HoldenCAPITAL was born. Although Holden started with a number of contacts in the industry, building credibility was nevertheless a slow process. “Ultimately, the first couple of years was working with those

“We only do construction loans and we only deal with developers. In that way it’s knowledge an inch wide and a mile high in the construction sector” banks … we’re seeing a massive shift in the market over the last 12 months.”

Credibility Understanding HoldenCAPITAL’s appeal to the developer community requires an under­ standing of Holden’s background. Holden first worked as a development manager before joining property finance group Ashe Morgan Winthrop. It was here, during the worst of the GFC, that he received a salutary lesson in the benefits of being a specialist in development rather than banking.

With a near freeze on all funding, the company began letting employees go, Holden recalls. “That was possibly a good thing for me, but my skill set was in property rather than in banking. I was one of 116 employees hired; I was the last one hired but I wasn’t the first one back out of the door!”

Going out on his own wasn’t an ambition of Holden’s, but the firm he had been working for

existing clients that I had, working on their projects, and then the team grew from there: we took on one extra guy, support staff and more people grew after that.

“The property developer looking for a broker is seeking someone who is at the top of their game and has been doing it for a long time,” Holden explains. “We do see people not from this sector trying to enter it, and there’s that old saying: ‘If you think a professional’s expensive, try hiring an amateur’… there’s been occurrences of when a developer has taken on someone who’s not an expert and the pennies they save cost them the pounds.”

Those clients frequently end up at HoldenCAPITAL’s door, Holden adds.

Holden counters doubtful clients through a combination of hiring and evidence. He has until now only hired people he knows.

Construction finance being a specialised sector, talented people will generally appear on Holden’s radar.

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“For us it’s not about diversifying by service or sector, away from construction finance … the growth for us is Sydney and Melbourne and enjoying what we do”

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PROFILE

DANIEL HOLDEN TIGHT CREDIT IS CRIPPLING DEVELOPMENT NAB’s Q2 Residential Property Survey looked at the constraints on new housing development.

What’s notable is that tight credit is the number one problem in all states except NSW Northern Territory/South Australia Tight credit Construction costs Housing affordability Western Australia Tight credit Housing affordability Sustainability of house price gains Victoria Tight credit Construction costs Housing affordability

Queensland Tight credit Lack of development sites Sustainability of house price gains

New South Wales Housing affordability Sustainability of house price gains Tight credit

Source: NAB Residential Property Survey, Q2 2016

Like many operators in this space, HoldenCAPITAL charges a fee, which Holden is careful to justify: “We offer people a list of client testimonials, projects we’ve done, which provides them credibility, and I do ask people to ask for the same from other providers.”

Products Working with sophisticated clients with complex demands in a market lacking in trust, HoldenCAPITAL’s approach to lending is correspondingly different to that of a normal brokerage. It can finance projects in three different ways: packaging deals to send to lenders, white labelling products, and lending from its own fund, which currently has $74m invested in various projects.

But the traditional brokerage side is still the biggest part of the business. Given the complexity and varying timescales in construction finance, broking means more than understanding lenders’ credit appetites.

“We’ve always seen a benefit to the extra cost of non-bank funding, and most of the time the outcome is a massive saving of time,” Holden explains. “It comes down to starting a project sooner, finishing it sooner, getting the profits sooner and moving on to the next project.”

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White labelling products allows the brokerage to be highly specific about what the mortgage process involves, when and what costs occur, and how this compares to a bank, by displaying charts and graphs where appropriate. It’s important to be open about the terms of business, Holden argues, because this means there won’t be any shocks for the client further down the line.

Finally, HoldenCAPITAL runs its own fund, in which high-net-worth individuals invest in projects on a case-by-case business.

Fund management has relatively high barriers to entry, observes Holden, and beyond the regulatory requirements he places further emphasis on credibility. “We’ve been doing it for a few years now; if you were trying to get it up and running from a standing start today, it probably would [be difficult]. We’ve got a good team of people who’ve been operating in that space for a long time, so it was easier for us as an established business.”

Expansion HoldenCAPITAL may not be interested in diversifying, but that doesn’t mean it’s not expanding. Satisfied clients remain “our best marketing tool”, says Holden, as well as

recommendations from builders, quantity surveyors, solicitors and accountants. On top of that, HoldenCAPITAL is building a distinctive brand in its own right, which Holden advances along several fronts. First of all there are the awards, of which Holden has a growing cabinet-full. Then there are the above-mentioned podcasts and videos, freely available on the website and promoted through LinkedIn. Holden is also a regular expert commentator in the media, quoted not only in broking trade publications but also developer publications and regional newspapers, including The Courier Mail.

The brokerage is also expanding in a literal sense: they’re about to open an office in Sydney and have been interviewing people with a view to setting up another office in Melbourne.

While Brisbane has seen some development, Sydney and Melbourne provide a much larger hunting ground for HoldenCAPITAL. “We’re already funding deals in Sydney and Melbourne, but we’re now at the point where we need local representation,” Holden says.

“For us it’s not about diversifying by service or sector, away from construction finance; we’re very happy being construction finance-centric.

The growth for us is Sydney and Melbourne and enjoying what we do.”

Holden is hiring, and he’s looking for a very specific type of broker, in keeping with HoldenCAPITAL’s ethos. Experience is, unsurprisingly, a big consideration, namely “an understanding of the development process and whether that means a couple of years in the trenches on the property side versus the banking side, or having worked on the banking side but having done at least a few years specialising in property”. Any new recruit needs to understand what’s at stake, Holden adds.

“There are a lot of variables: the quantity of money is higher; the borrower is more savvy; the ramifications for getting it wrong are more catastrophic.”

Above all, Holden wants someone who can step up in a challenging but rewarding sector.

“You’re dealing with big bucks and you need experienced guys who know what they’re doing. You’ve got to be able to back that up with a good skill set and a good knowledge to execute and get an outcome.”

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SPECIAL REPORT

AGGREGATOR ROUNDTABLE

2016

AGGREGATOR ROUNDTABLE Our third Aggregator Roundtable brought established aggregators, would-be disruptors and MPA readers together for the first time ever, through livestreaming technology, to discuss broking’s most pressing issues

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FOR A long time, it seemed aggregation had gone stale. The same old debates – independence, diversification, IT – continued to be batted around, but with little passion or actual change.

That was until 2016. The past year has not only provided new questions but made answering those older questions all the more important, which is why we convened our third Aggregator Roundtable to answer them.

Take independence, for example. ASIC’s review into remuneration – not to mention the Australian Bankers’ Association’s separate review – have left many brokers feeling under attack and unsure who to trust. They badly need an advocate, and both

lender-owned and independent aggregators have stepped into the breach, but in order to do so they need to earn brokers’ trust.

Or look at diversification. Brokers specialising in foreign-income clients did extremely well in 2015, topping many of MPA’s charts, but 2016 has seen many banks refuse to lend to foreigners altogether.

While helping brokers to diversify had previously been considered ‘proactive’ for aggregators, it has now become a ‘reactive’ necessity.

Perhaps most excitingly, the debate around technology has been re-energised by the entry of a would-be disruptor to aggregation. Although My Local Broker was only launched in April, we decided to include

them in our panel because of the fresh perspective and powerful CRM system they claim to be bringing to the industry.

Traditional aggregators will be forced to defend or upgrade their ageing legacy systems in response.

Indeed this very roundtable has been transformed by technology: it was only the second roundtable ever to be livestreamed online, following our Non-Major Bank Roundtable earlier this year. Our audience were able to text in questions to be answered by our aggregators in real time, introducing an unprecedented level of transparency to the industry. Read more about these audience questions in the sidebars accompanying this report.

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SPECIAL REPORT

AGGREGATOR ROUNDTABLE What are you doing to represent your members to ASIC and keep them updated throughout the remuneration review?

Whatever its results, ASIC’s remuneration review has already set the tone for broking in 2016 – anxious, suspicious and uncertain. Part of the problem stems from misinformation: prior to its recent requests for data, ASIC communicated directly with broker associations and aggregators, rather than brokers themselves or the wider media.

Aggregators have therefore been forced to play politics, having to represent their members’ views to regulators and keep their members informed – a job some have embraced more vocally than others.

Outsource Financial boss Tanya Sale is one of the most vocal advocates for independence in the industry. However, she saw collaboration as the best response to ASIC’s review: “We decided to use the FBAA and Peter White to be the voice of our members, because Peter was actually meeting ASIC regularly, and by regularly I mean once a month,” she said. Outsource then

“As an industry we’re all acting together in responding to ASIC’s concerns, and I’m not sure they even know what their concerns are at this point” Tim Brown, Vow Financial passed on information to its members through information days and partnership managers.

Their aim was to “calm the waters”, said Sale.

“We have to be careful that this isn’t sensationalised to something it’s not.”

Reassuring brokers that ASIC was not ‘out to get them’ was a central focus of all the aggregators on our panel. Vow’s Tim Brown, who was president of the MFAA until 2015, explained that “as an industry we’re all acting together in responding to ASIC’s concerns, and I’m not sure they even know what their concerns are at this point: it’s an informationgathering exercise”. Vow was utilising its compliance expertise to help brokers, he added. “Now that ASIC has sent out these information packs to brokers asking for information, we’ve said, ‘Please call us. We’ve

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got a compliance team here to help you and we’ll help you fill in the information so you get it correct’.”

My Local Broker, which only launched in April this year, was nevertheless taking regulation seriously, explained CEO Jaci Smith. “Building our software platform was done with ASIC front of mind. We did employ a chief risk officer in our business, and our mantra internally is to be proactive rather than reactive.”

Many lenders’ stance on the remuneration review is still unknown, but Choice Aggregation CEO Stephen Moore shrugged off suggestions that its ownership by NAB had any bearing on the review, pointing out the investment NAB had made in the company.

Brendan Wright, CEO of FAST – which is also

owned by NAB – said the industry had to be positive as regulatory pressure would not simply go away. “There’s also an ABA review as well, and my point is there will always be something going on, and our industry will face into these things,” Wright said.

Have recent restrictions on investor and foreign-resident lending affected your brokers, and what are you doing to help them respond?

As Vow CEO Brown put it, Australia’s banks have experienced a domino effect this year, one largely of their own making. The cause was foreign lending. When ANZ announced it would stop lending to 100% foreign-income borrowers, CBA, Westpac and NAB followed suit with their own restrictions, followed by a number of non-majors as the resulting flow of applications headed their way.

While the number of brokers specialising in this space is relatively small, Vow was home to many of them. From Brown’s perspective, it was a case of the majority being punished for the actions of a small minority who had faked

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THE PANELLISTS

Brendan Wright, CEO, FAST

Jaci Smith, CEO, My Local Broker

foreign income. “Most lenders were happy with the quality of the portfolio, with the exception of one group in particular, which has been well documented now, that did the wrong thing … we’ve had a number of audits now that have come through squeaky clean.”

Brown’s argument found some support from the panel. Choice boss Stephen Moore said he had dealt with a number of highquality brokers in the foreign-income space.

broking group that had been terminated for inappropriate activity.

The panel similarly took different views on what brokers should do. My Local Broker, as the name suggests, takes an ultra-local approach, stemming from Smith’s own experience. “Having been a broker I’ve always found there’s been enough business just in the backyard,” she explained. For Choice boss Moore – whose point was echoed by FAST

“There’s a sense of pride in having your own brand, and we don’t want to take that away from our brokers” Jaci Smith, My Local Broker Outsource’s Sale wasn’t so convinced, however, as she told the panel. “To go back to the claim that the majority of those brokers were quality, I’d probably disagree with that, otherwise we wouldn’t have had this major blow-up,” she said. Sale believed the banks were responding to regulatory pressure rather than panicking at a surge in applications. Brown countered Sale’s point, arguing that he only knew of one

CEO Wright – it was a salient reminder of the dangers of one-track brokerages. “For me it is a reminder that if you specialise in one area only you should think more broadly about your business,” Moore said.

Vow was exploring alternative funding arrangements, Brown said, including “overseas investors who are keen to help us get into this space and helping them set up through our

Stephen Moore, CEO, Choice Aggregation

Tanya Sale, CEO, Outsource Financial

Tim Brown, CEO – lending, Yellow Brick Road Group* *integrating Vow Financial

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SPECIAL REPORT

AGGREGATOR ROUNDTABLE According to the aggregators on our panel, diversification also depends on partnerships.

In June, Vow partnered with commercial comparison site Valiant Finance to offer brokers around 34 additional niche lenders, which Vow would not have been able to deal with through its own platform, Brown explained. At Outsource, partnering was a response to members’ demands for a general insurance offering. “We partnered up with Allianz and that’s been brilliant for us … what that allows us is to branch into other things,” Sale said.

Those “other things” included reverse mortgages, Sale explained, recalling earlier points made by Wright and Brown that financial planning, wealth and risk should be on brokers’ radar. In terms of more immediate prospects, Moore advised brokers to look at small commercial and asset finance deals for SMEs, an area he believed would grow for more than five years, while he emphasised that “it depends on where you’re at with your business, and coming up with the right model to suit your business”. mortgage management business to help them potentially fund those loans”.

This project was in its early days, Brown cautioned, with many groups still wanting to fund only their own investments. In the meantime their brokers were still lending to Australian Chinese, he added.

What have you done in the last 12 months to help your brokers diversify?

Diversification may be second only to thought leadership in terms of buzzword of choice for broker associations and lenders, but in fact aggregators play the biggest role in helping brokers actually introduce new types of lending.

Diversification can be a costly and timeconsuming business, and we wanted to know what our aggregators were doing in practical terms to help brokers make the switch.

FAST has long been a home for strong commercial brokers, as well as a number of residential brokers. Indeed Wright insisted that diversification worked in both directions: “There is significant opportunity for traditional mortgage brokers to do commercial lending,

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“Let me be clear that commercial and asset finance brokers more and more are doing home loans as well” Brendan Wright, FAST but let me be clear that commercial and asset finance brokers more and more are doing home loans as well.”

FAST runs summits on commercial and asset finance lending, Wright said, and is launching an asset finance white label product.

However, the biggest step forward, our panel explained, had been in application software. Lenders were investing heavily in allowing smaller commercial transactions to go through standard application software, Wright observed. Difficulty applying was holding many brokers back, according to My Local Broker chief Smith. “They’ve always wanted to get into that space, but there’s been a lot of manual processes for getting into that space and CRMs haven’t traditionally supported that functionality as best they could,” she said. In response they were building this functionality into their software, Smith added.

Given recent launches of branded aggregators, do you think aggregators with a traditional B2B model will have to improve their brand recognition amongst consumers?

‘Aggregator’, as MPA has traditionally used the term, means ‘wholesale aggregator’, a business-to-business enterprise. Recently, however, a number of aggregators have tried to build brand recognition, either by launching new retail aggregation arms, through partnerships, or by promoting their own brands.

Choice – comprising Choice Aggregation and Choice Home Loans – provides a particularly interesting example. According to Moore, the continued separation of the two brands offers brokers more options, although he believes that “in future the retail brands have an increasing role to play: in some ways

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SPECIAL REPORT

AGGREGATOR ROUNDTABLE AUDIENCE QUESTION: LENDER INCENTIVES One audience member texted into to ask our panel how they dealt with additional lender incentives to drive volumes their way.

Tanya Sale: “I guess you need to define incentive. If you’re talking about bonus incentives it’s up to each aggregator whether they want to go down that path; we certainly haven’t … I would put my hand up any day of the week if a lender wanted to run a training workshop for our members; I wouldn’t call that an incentive” Tim Brown: “I think most aggregators discourage volume bonuses being paid to write more volume; we’re not fans of that whatsoever. There is money paid by lenders that goes towards training and PD days and compliance and getting in front of the brokers, but they’re not related to volumes”

it’s a natural evolution of the industry; you see some natural consolidation”.

“What we’ve found is that the type of broker that is attracted to a brand has changed,” Moore continued. “Now already-successful brokers [are] also looking to move into brands.”

Brands could allow brokers to rapidly scale their business through documented processes, while the Web would also be a driver, Moore said. “It’s very difficult, as an individual, to break through the clutter of the digital world without a strong brand behind you.”

That challenge of reconciling digital marketing with individual brands was at the centre of My Local Broker’s business model, Smith explained. On the consumer side, she said, “it’s about everyday Australians finding their local broker through our platform; we’re promoting that platform through radio, we’ll be doing TV commercials soon”. They had previously considered a franchise model, but Smith believed the leads the marketing generated would best go to independent brokers. “There’s a sense of pride in having your own brand and we don’t want to take that away from our brokers,” she said.

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“This whole industry is based on relationships, and the only way to get a really strong relationship is when you’re face-to-face” Tanya Sale, Outsource Financial One aggregator in an interesting position is Vow, which as a wholesale aggregator has a number of brokers with their own brands but that are also part of the Yellow Brick Road group. Working across both as CEO of lending, Brown observed that Vow members had their own demands, which they catered to: “templated documents, help with social media and internet, and how to use search engine optimisation and promote themselves to their local community”.

Strong calls for the wholesale aggregation model came from FAST and Outsource.

Wright believed FAST’s brand – and that of brokerages – should be about helping their clients’ businesses: “Having our name on the front door of the broking business is not important; helping them execute on their

strategy is.” For Sale the brand was the individual: “We don’t believe we need to have a brand; we’ve always said from day one, ‘It’s never about Outsource’ … the client goes to that person – they’re the brand.”

Please describe what you do on an individual level to help your brokers grow their businesses?

Between technology and regulatory pressure, learning and development has been transformed in recent years. On the surface, this has meant more is available to brokers – webinars on ASIC’s review; PD days, commercial summits – but many brokers claim the individual attention and advice they once received has been forgotten, a belief that challenger aggregators have capitalised upon.

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SPECIAL REPORT

AGGREGATOR ROUNDTABLE the individuals. “Technology is great but there’s also a very big sense of individualising the technology as well,” she said.

What do your IT systems allow brokers to do, and do you have any improvements in the pipeline?

Our final question was determined by our Brokers on Aggregators survey, the results of which we received the day before the roundtable. The survey’s main message was around IT and its pivotal importance for brokers in joining aggregators, leaving aggregators, and preventing dissatisfied brokers from making a move.

It’s a result that was certainly encouraging to My Local Broker. Indeed My Local Broker characterises itself as a disruptor in the aggregation space, with its San Franciscodeveloped Chief CRM system as a key offering.

According to CEO Smith, Chief differs from older legacy systems in allowing much easier integration with other systems. “It has become quite integral that you can integrate quite quickly and at a low cost; the cost of building Outsource Financial make much of the fact that all their new brokers will meet face-toface with Tanya Sale. “This whole industry is based on relationships, and the only way to get a really strong relationship is when you’re face-to-face and eyeball someone,” Sale explains. “I believe that they should get to know me; I’m the one driving the company, and if they don’t like what I’m saying or how I’m presenting the company to them then they might not be a fit for us.”

Productive conversations between brokers and partnership managers are important at FAST, Wright said: “These are strategic business-to-business conversations, not how much you’re going to sell next week.” FAST put a lot of effort into hiring, he explained, to find effective and diverse PMs who could actually reflect the diversity of FAST’s membership.

Not everyone on the panel saw a conflict between face-to-face interaction and bigger events. As Choice boss Moore put it, “It’s not an either-or”.

“What we do know – and this is well documented in learning as well – is that it’s far better to learn from someone who’s

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“At a single point in time we might come up with the best system, but over the long run you want global best practice” Stephen Moore, Choice Aggregation experienced than just to learn theory,” Moore said. “At Choice we match up individuals at a local level and then bring in an expert.” The expert was often a broker who had experienced the topic being discussed, adding to the peerto-peer learning environment.

Similarly, at Vow the most popular events were their compliance workshops, according to Brown. “It really is an open-risk environ­ment where they bring deals in and talk openly to the group over how they can become compliant and stay compliant moving forward.” This was accompanied by audits to identify where training was most needed, Brown added.

My Local Broker brought a slightly different approach to the debate, one centred around technology. Its BDMs identified brokers’ individual needs and then fed these back to software developers, Smith explained, who then customised the IT systems to suit

these systems has been quite a lot. We’ve spent $5.5m on our platform in the past 12 months,” Smith said. Already the system had allowed a number of partnerships with VEDA for credit checks and with CoreLogic to look at individual suburb and property data, she explained, with further partnerships on the way.

Choice CEO Moore took a somewhat different view. “Our approach was to use Salesforce as the core of our system,” he said.

“The reason for that was at a single point in time we might come up with the best system, but over the long run you want global best practice, and that’s the beauty of having a system like Salesforce at the core: you’re always staying up to date with global best practice.”

Podium – the CRM used by FAST, Choice and Plan – was evolving towards the ‘nirvana’ of having a client’s home, commercial and asset finance going through the same

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application system, FAST CEO Wright said.

“The Podium system can now capture the data of a business client and will soon have the ability to lodge deals with asset finance and commercial lenders that have that capability.”

Vow and Outsource took the view that IT was best outsourced. “We made the decision a long time ago that we are a sales and marketing business, not an IT business,” Brown said. “We find that best in breed today is not best in breed in two years’ time, so you have to adapt quickly.” He said Vow had partnered with Rubik to develop a financial planning budgeting tool, including a mobile app brokers could sell on to clients.

At Outsource the focus was on providing ‘bolt-ons’; specifically, outsourced processing and database marketing. “Yes, we believe IT and CRM are extremely important, but when your members already have a CRM system you need to think outside the square and come up with other solutions,” Sale concluded.

AUDIENCE QUESTION: PROPERTY GROUPS One audience member texted in to to ask our panel whether they offered brokers access to property groups. Here are the panel’s responses: Tanya Sale: “We don’t. We thought about it going down that path, but we decided not to muddy the waters on that side of things” Tim Brown: “We did; we have a property panel and wanted to make sure they were dealing with quality property developer groups. We do due diligence on all the groups that join the panel and we take them off too, if we feel there’s any scrutiny or concerns from a broker’s perspective…”

Brendan Wright: “At FAST we don’t have a panel but our brokers do a significant amount of commercial property funding and help other brokers connect into that space as well. One thing we do is help provide more choices for brokers around property development funding” Jaci Smith: We’ve had a number of people approach us in recent times and I’ve made a decision to go down that road at the moment, particularly with the oversupply of apartments and the crisis in this area…”

Stephen Moore: “We recognise this is a specialist space, and we have a number of businesses within Choice who do specialise in development, and for other brokers who are interested we help marry people up and do it that way rather than have a separate panel in our own right”

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FEATURES

NON-MAJOR BANKS

TACKLING THE BIG ISSUES Non-major banks respond to your key concerns about turnaround times, BDM support and credit policy and tell MPA editor Sam Richardson exactly what they’re doing to improve

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HOLDING BANKS to account can be problematic. In theory, of course, the best banks would get all the customers and the worst banks would lose business, but that would necessitate all brokers knowing which banks were doing well, which is why we’ve run our Brokers on Banks survey for 13 years.

Brokers on Banks tells us what banks could improve, but it doesn’t tell us if they actually will improve. As the recent debate over handing on RBA rate cuts demonstrates, banks need to balance a number of interests – savers and borrowers, brokers and direct channels – and so don’t always respond to brokers’ feedback as you’d expect. The only way to determine what the banks will do is by going direct to Australia’s non-majors and asking what exactly they are doing to improve their standing in the broker channel.

To be more specific, we wanted to know what the banks were doing to improve in the three areas brokers consistently say are most important: turnaround times, BDM support and credit policy. These performance categories were largely dominated by the major banks in last year’s Brokers on Banks survey, so the non-major banks, with few exceptions, most definitely have something to prove.

The answers the banks gave us reflect a tension and transition in the space. Non-majors in recent years have put considerable effort into specific competitive offers, such as low rates, loosened serviceability, great commission, but this has backfired with turnaround time blow-outs and occasionally poor service. Some banks are now looking to move towards the type of consistent turnaround times, BDM support and credit policies you might associate with the major banks. Other banks are looking to distinguish themselves from a marketplace in which many lenders are increasingly interchangeable, through targeted offers, policies and systems. This feature talks to both camps.

Before reading this survey, have a look at MPA’s Brokers on Banks survey, from which the topics of this feature are drawn.

You can find it in MPA 16.4, which is available online as an e-magazine.

WHAT DO BROKERS WANT? Our 2016 Brokers on Banks survey asked brokers to rate how important different performance categories were to them, from 1 (not important) to 5 (very important). We’ve chosen the top three categories, which were the same in 2015.

Turnaround times 4.74 BDM support 4.73 Credit policy 4.68 Interest rates 4.51 Online platform & services 4.13 Product range 4.13 Commission structure 3.99 Communications, training & development 3.85 Product diversification opportunities 3.56

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FEATURES

NON-MAJOR BANKS

HOW THE NON-MAJORS PERFORMED Our Brokers on Banks survey collected performance scores for each category and for each bank.

Here’s how the non-majors featured here performed: Adelaide Bank Relatively good commission structure Far behind other non-majors in essential categories AMP Relatively good BDM support Behind other non-majors for turnaround times Bankwest Top bank for interest rates; brokers praised Bankwest’s ‘Broker Chat’ function Sits outside the top five for turnaround, BDMs and credit policy ME Relatively good positions in non-essential categories (ie interest rates) Lagging behind in essential categories such as turnaround and BDMs Suncorp Very high overall score (fourth among all banks), with top five finishes for turnaround times and BDM support, and also won Product of the Year Outside the top five for credit policy

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Turnaround times Not only were turnaround times brokers’ number one concern in our Brokers on Banks survey, they have been their number one concern for over five years.

Unfortunately for banks, the relationship between turnaround times and overall success is generally a negative one: brokers expect a bank will have good turnaround times, but poor turnaround times can cause major damage to banks, regardless of competitive interest rates, good BDMs and the like.

Many non-majors have found this out the hard way, through limited time offers which lead to blow-outs as low-capacity processing teams and systems become overwhelmed.

Unlike their larger counterparts, the non-

bank intermediaries. “While there will only be minimal changes for our brokers in the way they interact with the system, they will experience faster application times and more accurate back-channel messaging.” Similarly, Adelaide Bank is at the “business end” of developing their new LendFast platform, which will be rolled out over the next few months, says third party general manager Damian Percy. ME is also developing a new broker platform.

While new systems are high-profile, many of the improvements the banks highlight are relatively small, such as new tools and ways to apply. One example of a non-major doing this is ME, whose new tools “will automatically assess credit policy,

“We’re introducing new decision and valuation tools that will automatically assess credit policy, loan profile and available customer information in a matter of minutes” Lino Pelaccia, ME majors have been relatively open about these blow-outs, and it seems that openness about turnaround times is here to stay, with three out of our four banks telling us their target turnaround times. Adelaide Bank is at 2.8 days (plus time to receive the valuation), AMP is at 2.45 days, Bankwest is at 24–48 hours, and Suncorp is at one day for initial assessment and two days for more complex applications. AMP says it tracks turnaround times daily, while Suncorp’s brokers can find the current turnaround times on their broker portal.

Turnaround times have been increasingly equated with technology, and the 56% of brokers who thought turnaround times had improved gave hundreds of examples of how technology had sped up the process. The most obvious way to improve technology is to replace legacy systems, which Suncorp is doing, gradually replacing its core banking platform, explains Steven Degetto, head of

loan profile and available customer information in a matter of minutes”, says general manager of broker sales Lino Pelaccia. “This will complement our automated pre-approvals and coaching of credit assessors already in place.” Suncorp is introducing Docu-Sign to allow “some existing customers” to review documents electronically, as well as electronic signing and emailing of documents.

There is a risk of overfocusing on technology. As one broker in the survey told us, “applications are dependent on humans to keep the workflow going”; another, criticising CBA, noted that “CBA is more automated now but that just slows everything up because nobody can make a decision and files continually get stuck in the system”. Brokers told us they wanted a clear process with a single point of contact, which is the approach Bankwest have been taking with their single-case owner

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FEATURES

NON-MAJOR BANKS

TURNAROUND TIMES In our 2016 Brokers on Banks survey, we asked brokers whether they’d seen turnaround times improve or worsen over the preceding year: Improved significantly

Improved

16%

40%

No difference

28%

Worsened

14% 14%

Worsened significantly

2%

structure, introduced in 2015, in which a single person looks after the deal from beginning to end.

The next 18 months will see the bank take this philosophy to the rest of the business, says Stewart Saunders, general manager of broker sales, with the aim of tracking the progress of the loan at any stage in the application by the second half of 2016. The aim is to keep brokers and their customers informed, and the single-person case ownership model is also currently being trialled in the examinations team.

AMP has also adapted its processes, according to head of sales and marketing Glenn Gibson. “We have implemented a new operational structure that allows us to have more file ownership, thereby reducing or eliminating the ‘hand-offs’ that slow the process down.” The focus, Gibson argues, is now on each team member’s “personal responsibility” to improve turnaround times.

Non-majors still need to address brokers’ questions over their ability to handle spikes in applications. AMP has introduced a “consistent customer service initiative”, which Gibson claims will result in “a fundamental shift in our ability to handle spikes in volumes and we will only see this continue to improve over time”.

Bankwest says it has had no problems handling spikes since the introduction of the singleperson case owner structure, while Suncorp says daily publishing of turnaround times will help brokers manage client expectations.

Adelaide Bank has focused on staffing levels, says Percy, and is “investing in training additional staff who prefer a flexible working arrangement that helps us cope with the peaks and troughs”.

BDM support Turnaround times can wax and wane, but BDMs tend to stick around: the top three banks for BDM support in 2015 are the same in 2016, even if the order has shifted slightly. BDM support is therefore not only highly important – second only to turnaround times – but a considerable obstacle to challenger banks

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looking to rise to the top. That’s because introducing a new product or slashing a rate is far easier than expanding or re-recruiting a new BDM team; furthermore, brokers get accustomed to dealing with certain BDMs. Therefore we wanted to know how exactly

“We’ve extended the reach of our phone-based team into areas where we have no – or limited – boots on the ground” Damian Percy, Adelaide Bank the non-majors planned to improve their BDM offerings.

Banks could start by simply expanding their BDM teams. ME’s team has been expanded from nine to 15 employees, Pelaccia says, including a team of seven state-based relationships managers.

When banks elaborated where they would add extra BDMs, these plans tended to reflect Australia’s differing housing markets. Bankwest, for example, is looking to take advantage of “immense opportunity” on the East Coast and so are adding BDMs in Victoria, NSW and Queensland. Broker chief Saunders explains that the bank is secure in its home state of Western Australia, hence their expansion plans looking east. “We were founded in 1895 and have been working with brokers for decades! Our focus is on maintaining our relationships with brokers,” he says.

Additionally, Suncorp is expanding its teams in Victoria and NSW. Not all banks see recruitment as the best way forward: AMP tells MPA they already have ‘solid coverage’ across their target market. Instead, says Gibson, “our focus over the next 12 months is around what structure can we put in place to support our BDMs to free them up to serve our brokers

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FEATURES

NON-MAJOR BANKS

Q&A: CREDIT POLICY NICHES We asked the non-majors: Is there one particular aspect of your credit policy which is significantly better than other non-majors?

Adelaide Bank “There are quite a few nuances to our credit policy, particularly around our specialised products like low doc and our bridging finance offering. Our SmartSuite Commercial product, particularly, is a ripper and our BDMs know the ‘secret sauce’ so I’d encourage brokers to have the chat” AMP “Our credit policy wins business due to the fact that it is well balanced and consistently applied. At AMP bank we share our policies with our brokers so they know exactly what we will or won’t do.”

Bankwest • “Construction of multiple units on one title (up to four) up to 80% LVR • Enhanced cash-out and parental guarantor policies • Cap LMI at 98% on owner-occupied loans” ME “As part of our purpose of helping all Australians get ahead, we do have a policy for first home buyers where we will, based on appropriate assessment, potentially capitalise the LMI up to 97%” Suncorp “We recently won the national Non Major Lender of the Year Award at the Mortgage and Finance Association of Australia’s (MFAA) National Excellence Award”

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even better”. Additionally, Adelaide Bank doesn’t have plans to expand. All the banks we talked to pointed to restructuring as a way to improve BDM service to brokers. For AMP, having multiple contact points – BDMs, contact centre and processing staff – is important to help get applications back on track.

Complementing traditional on-the-road BDMs with desk-based BDMs is a priority for Adelaide Bank, Suncorp and Bankwest.

“We have also introduced a number of phone-based BDM roles to help us support a greater number of brokers,” explains Suncorp boss Degetto, “both those who use us regularly, and those who may use us less frequently.” At Bankwest all brokers are assigned a BDM and a desk-based ‘broker support manager’ (BSM), as well as a Credit Support Hotline.

Brokers often name individual BDMs in their comments for the Brokers on Banks survey, and this is invariably because that BDM has helped them to progress an

function, which was praised by brokers for ease of use.

Not all of our questions concerning BDM support were adequately answered by the banks. We were interested in the provision of support for brokers in regional areas – a complaint that appears every year in our survey – and none of the banks mentioned regional BDMs. Adelaide Bank does say “we’re getting really positive feedback where we’ve extended the reach of our phone-based team into areas where we have no – or limited – boots on the ground”. But with limited opportunities for residential price growth in these areas, it may be that these banks simply don’t see a reason to invest outside the East Coast boomtowns.

Credit policy For the last few years of Brokers on Banks, credit policy has been consistently rated by brokers as more important than interest rates. This finding is all the more important to non-major banks,

“Our focus over the next 12 months is around what structure can we put in place to support our BDMs to free them up to serve our brokers even better” Glenn Gibson, AMP application ‘stuck in the system’. It’s somewhat ironic, therefore, that many nonmajors are looking to use technology (including the above­ -mentioned tracking system) to help BDMs solve problems caused by technology.

“Sometimes the best way to get an application back on track is human intervention,” says AMP’s Gibson, but the bank is also monitoring application progress behind the scenes to spot delays. At Suncorp, brokers will have access to the same information on their current applications as Suncorp staff through the broker mortgage manager, Degetto claims. Finally, Bankwest will continue to run its online Broker Chat

who utilise competitive credit policies and interest rates – and sometimes both – to draw customers away from the majors. With APRA’s tightening of investor lending and a politicised debate over whether banks should pass on cash rate cuts, we wanted to know how non-majors would utilise credit policy in the year ahead.

Making life easier for property investors would be an obvious place for the nonmajors to start. “We are certainly seeing interest rates becoming more competitive,” says AMP boss Gibson. “I don’t foresee a change to LVRs or serviceability in the near future, but with interest rates at their current low levels, affordability for invest­

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FEATURES

NON-MAJOR BANKS

NON-MAJORS’ FULL YEAR RESULTS Adelaide Bank As part of Bendigo and Adelaide, residential home loans balance up 4.0%, with total lending up 5.1% (referring to the 2015/16 FY) AMP Overall mortgage book growth of 5% “constrained by lower investment property lending” (referring to the 2015 calendar year) Bankwest Residential home loans up 5% “reflecting lower system growth in Western Australia and tightening of lending criteria” (referring to the 2015/16 FY) Suncorp Bank Residential home loans balance up 5.9% “broadly in line with system growth and management aspirations” with total lending up 4.6% (referring to the 2015/16 FY) ME Full year results not available at the time of writing

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ment purposes is very strong.” Bankwest’s Saunders says that despite rates improving “it is unlikely that the tightened conditions will relax significantly in the short to medium term.”

Not all the banks expect serviceability to improve, however. Adelaide Bank’s Percy “wouldn’t expect to see any change in

targeting mum-and-dad clients (see MPA 16.1), doesn’t give any indication that change is likely, answering our question with a reference to their score in the Roy Morgan Consumer Confidence survey of June 2016.

It’s possible that Suncorp, alongside other banks, is turning away from credit policies as a way to distinguish itself.

“We have also introduced a number of phone-based BDM roles to help us support a greater number of brokers” Steven Degetto, Suncorp attitude to serviceability on the part of lenders that is likely to lead to increased capacity, be it investors or anyone else”.

Percy’s reasoning is that regulators have not yet relaxed their attitude, and their views tend to dominate. Suncorp sidestepped MPA’s question about investor clients, but their annual report for 2015/16 gives some indication of their stance: “the Bank has taken a cautious approach to investment lending and large scale property develop­ ment, and has limited exposure to inner city apartment markets”. ME says it doesn’t differentiate between investors and owneroccupiers in its credit policies.

Beyond investors, we wanted to know if banks were targeting specific areas with competitive policies (see ‘‘Credit policy niches”, p36). ME says it is targeting first home buyers by capitalising the LMI up to 97%, although the decision will be “based on appropriate assessment” of the buyer.

Similarly, Bankwest says it caps LMI at 98% on owner-occupied loans, in addition to “enhanced cash-out and parental guarantor policies”. Adelaide Bank has gone in a very different direction, with competitive credit policies for low-doc and bridging finance, according to Percy. “Our SmartSuite Commercial product, particularly, is a ripper and our BDMs know the ‘secret sauce’ so I’d encourage brokers to have the chat.”

Suncorp, which has consistently said it is

“Not a lot of lenders compete on credit policy niches in today’s market as they would have done in the past,” explains AMP’s Gibson. “Our credit policy wins business due to the fact that it is well balanced and consistently applied.”

Gibson’s point raises more questions than it answers, namely: without credit

“It is unlikely that the tightened conditions [for investors] will relax significantly in the short to medium term” Stewart Saunders, Bankwest policies, and with rock-bottom interest rates – and consequently profit margins – across the board, how do non-majors distinguish themselves from the majors?

To see whether Gibson was right, or indeed whether any of these bank’s approaches to turnaround times, BDM support or credit policy have worked for brokers, see our Brokers on Banks survey in MPA 17.4.

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FEATURES

BROKERS ON AGGREGATORS

2016

BROKERS ON AGGREGATORS What does the perfect aggregator look like, and does it exist?

We surveyed hundreds of brokers to find out if your aggregator could be doing better

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BEING A small business person is about independence: having your success or failure entirely in your hands; building a business rather than waiting on a pay cheque – and for many brokers, these were the reasons they went into the industry. Yet in 2016 brokers remain dependent upon aggregators. From training to IT support and commission payments, an aggregator can help brokers become brokerages, and brokerages become success stories, or stop a business in its tracks.

MPA’s Brokers on Aggregators survey is about determining how an aggregator can best support brokers. Unlike lenders, aggregators aren’t primarily selling a product, but that doesn’t mean they can’t be held to account. We’ve asked brokers what they want from their aggregator, how well their aggregator is providing it, how they’d like to pay their aggregator, and how much their aggregator has supported their business growth.

Surveying aggregators is different to a survey of lenders as most brokers will only

use a couple of aggregators throughout their careers, whereas they have access to a large panel of lenders. Satisfied brokers are likely to highlight their aggregator’s best points; unsatisfied brokers will highlight where their aggregator has failed.

We’ve used a combination of numerical scores and comments to produce a balanced view of aggregators; if we haven’t found the evidence to substantiate a claim then we haven’t mentioned it.

This year we’ve also introduced new questions related to ASIC’s remuneration review. The regulators are looking to aggregators for data and to gain an understanding of the broker market; brokers want to know exactly what’s going on and what it means for their business.

By picking out examples of best practice, we believe this survey goes some way to defining the ‘perfect aggregator’, depending on your business and ambitions. Now it’s time for you to look at your current aggregator: do they measure up, or could your brokerage do better?

OUR TYPICAL RESPONDENT

Is aged 46 to 55

Has an annual volume of $0–$10m

Has been in the industry for 13 years

STAR COMMENTS Our final question was all about the bottom line: How much has your aggregator contributed to your business’s success?

Two responses stand out, for clarity and imagination respectively:

“They leave me alone. That’s the way I want it.

I like to run my own business without interference, training, meetings etc. They are available when I need them” FAST broker

“Enormously – my aggregator is my pit crew – without them I’d have to spend so much time tinkering with the engine, fitting the tyres, changing the oil and all the other ‘behind the scenes’ – yet vital – aspects of my business, I’d never have time to race” AFG broker

These brokers each walk away with a gourmet hamper from The Hamper Emporium.

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FEATURES

BROKERS ON AGGREGATORS

WHAT DO BROKERS WANT? Aggregators need to play many different roles, depending on the state of a broker’s business AGGREGATOR SERVICES, RANKED BY IMPORTANCE 1 = not important, 5 = very important Services

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Importance Change indicator from 2015

Accurate and on-time commission payments

4.60

Quality of lending panel

4.58

Compliance support

4.41

IT and CRM support

4.37

Communication with brokers

4.33

BDM support

4.26

Training and education

4.18

Additional income streams

3.77

Marketing support

3.63

White label offering

3.35

Lead generation

3.00

UNLIKE LENDERS, aggregators can afford to appeal to just a small proportion of brokers – indeed some regard this as a prudent commercial strategy, given that different brokers prefer different fee models and prioritise different services. What our survey shows is there are quite a few areas that no aggregator can afford to overlook.

We asked brokers which services were most important to them, and it’s notable how many services received an average score of between 4 (important) and 5 (very important). By this logic, commission payments, lending panels, compliance support,

preferences are divided between new brokers wanting more support and their more experienced counterparts who feel they don’t need it.

One eChoice broker, who we can ascertain was new to the industry as she attended their academy and praised her BDM, Nick Dalamagas, as well as the aggregator’s support, from compliance to IT and beyond.

“They are avant-garde in many parts of the business bringing partners in all the time – e.g ALI Allianz etc – giving my business other sources of revenue. I would recommend them as an aggregator to anyone,” this broker said.

“They do what we pay them to do well and we have a relationship that is based on mutual respect for what both parties bring to the table” Connective broker IT support, communication, BDMs and training are non-negotiables – a very long list.

Only additional income streams, marketing support, white label and lead generation can really be regarded as optional.

What these numbers can’t tell us is whether it’s important for aggregators to perform these services competently – such as providing a working IT system and an extensive panel of lenders – or to go beyond that and offer more support than their competitors (more training days, regular BDM visits). Comments suggest that brokers’

On the other hand, the manager of a multi-award-winning brokerage, who was with Connective, told this survey that “Connective have been involved with our business as much as we need them to be. We have more of a consultative relationship and that works well for us. They do what we pay them to do well and we have a relationship that is based on mutual respect for what both parties bring to the table.”

Do beginner and high-performing brokers really have markedly different needs?

We broke down our ratings for importance

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by annual volume. We found that compliance support, for example, was most important at the lower end of the volume scale (up to $20m), while the importance of IT and CRM support rises with a broker’s annual volume – most likely because they have a larger customer base and more incoming deals to process. (For more on IT support turn to the final page of this survey.)

As expected, the need for lead generation, training and marketing support falls with volume, and as our chart shows, preferences when it comes to commission also change with volume.

Based on our ‘typical respondent’ profile (see previous page), the overall preference for commission split structures makes sense: our typical respondent has an annual volume of $0–$10m, whereas flat-fee structures have more appeal for high-

performing brokers (financially speaking).

Additionally, commission-split aggregators such as AFG, FAST and Outsource Financial were heavily represented in this survey. For a more accurate view of commission preferences, have a look at our graph of volumes versus fee models below.

Some needs are universal, including good BDMs, an excellent panel and on-time commission payments. Sadly, the comments suggest that not all aggregators can even offer these, with unmet needs tending to overlap: commission payment problems and poor IT, for example, came up in several comments.

Clearly, aggregators need to be highly confident that they understand their members’ needs – and indeed whether their members are a homogenous group – before envisioning any sort of cost-cutting when it comes to their core services.

ARE YOU HAPPY WITH THE FEE/COMMISSION SPLIT?

29%

Very satisfied

50%

Satisfied

12%

Unsatisfied

9%

Very unsatisfied

Proportion in favour

ANNUAL VOLUMES AND PREFERRED FEE MODEL 80% 70% 60% 50% 40% 30% 20% 10% 0%

Average Flat fee Transaction fee Commission split $0–$10m

$10,000,001–$20m $20,000,001–$40m $40,000,001–$60m Broker annual volume

30% 12% 58%

$60m+

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FEATURES

BROKERS ON AGGREGATORS

RESPONDING TO REGULATION Reviews by ASIC and others are forcing aggregators to step up, and brokers are happy with their response KEEPING BROKERS INFORMED

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35%

Very well

27%

Well

26%

OK

8%

Badly

5%

Very badly

A DISTINCTIVE feature of aggregators – and another way they differ from banks – is that their business model is nearly entirely dependent on brokers. If brokers disappeared, then aggregators would need to radically alter their business model to survive. That might sound extreme, but the outcomes of ASIC’s remuneration review – not to mention another review by the ABA – could spell chaos for brokers and therefore for aggregators.

Despite all of this, it’s unclear whether advocating for brokers in the public space is necessarily part of an aggregator’s job. It’s certainly a big ask, given most aggregators have close to zero public profile or lobbying resources, and some are owned or heavily

their public advocacy of brokers. One AFG broker commented that “their advocacy for brokers during the ASIC review has been immense. Keep up the fantastic work”. An Outsource broker noted that “Tanya Sale always has her Mortgage Advisors as her top priority especially when she fights the banks on her behalf or ASIC for that matter. You always know they are on your side and you are working for the same cause”.

Through their vocal commentary both within and outside the industry, AFG and Outsource have made it clear that they back brokers, and brokers have noticed. Other aggregators were celebrated for keeping their brokers updated behind the scenes about the

“Their advocacy for brokers during the ASIC review has been immense. Keep up the fantastic work” AFG broker reliant on banks, whose stance in the commission review has been (perhaps deliber­ ately) difficult to ascertain. Nevertheless, ASIC has reached out to aggregators – through data requests, roundtables and meetings – so brokers are dependent on aggregators to represent their interests and keep them informed.

What’s clear is that the vast majority of brokers trust their aggregators – 84% believe their aggregator will represent their interests above those of lenders. AFG and Outsource received particular praise from their brokers for

review and other new regulations: FAST were endorsed by one of their brokers for their “continual updates in the changing market – paying particular attention to ASIC and APRA regulations and guidelines – they make life simpler for the broker”. With some considerable exceptions in the comments, the numbers suggest that brokers are satisfied that their aggregators are keeping them informed about ASIC’s review.

There are some suggestions that the current regulatory pressures will have long-term consequences for brokers and aggregators.

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Our ranking of aggregator services (see p42) shows that compliance support has jumped up the rankings from sixth most important service in 2015 to third this year. While compliance is most important at the lower end of the volume scale, even the most high-performing brokers gave it an average importance rating of 4.04 (4 corresponds to ‘important’).

Compliance support brings in a number of other services, most obviously an aggregator’s competence in training and education. The comments in this survey suggest that most brokers view compliance support as an aggregator helping them to stay safe while taking the minimum time out of their business.

As one eChoice broker put it, “eChoice provide an excellent compliance system making it almost impossible to not meet NCCP requirements. All documentation is provided with a fail-safe check system, making me confident that I have not missed anything. This allows me to spend more time on customers and their needs”.

While future surveys will be needed to confirm any long-term changes, this year’s survey suggests that 2016’s regulatory changes are having an effect on what brokers want from their aggregators. Some aggregators have chosen to go public with their views, and their reputation has improved accordingly. Other aggregators have successfully stepped up their compliance support and communication to their brokers (not all, however). Compliance support, it appears, is becoming much more than an issue for junior brokers; it’s essential for every brokerage.

HIGH TRUST IN AGGREGATORS

84%

Yes

We asked brokers: Do you believe your aggregator does enough to accurately represent your interests – above those of lenders – to APRA and ASIC?

16%

No

WHO NEEDS THE MOST HELP WITH COMPLIANCE? 5.0 4.9

Importance 5 = very important 1 = not important

4.8 4.7 4.6 4.5 4.4 4.3 4.2 4.1 4.0

$0–$10m

$10,000,001–$20m $20,000,001–$40m $40,000,001–$60m Annual volume

$60m+

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FEATURES

BROKERS ON AGGREGATORS

MAKING A MOVE Brokers are unlikely to change aggregators, but those that do share many similar characteristics

PUT SIMPLY, our survey’s main message

their current aggregators are failing them, most notably when it comes to IT and CRM support. One Choice broker complained that they “constantly experience IT issues with Choice to the point where I am unable to lodge applications for several days due to platform issues. This severely affects my business”.

Poor BDMs, commission payments and, interestingly, poor lead generation were other reasons to leave – the latter presumably being driven by beginner brokers for whom lead generation is a more pressing need.

There is a difference of course between an IT system actually failing and an IT system

when it comes to brokers leaving their aggregators is that it’s still relatively rare.

While the proportion considering leaving may have increased since 2015, we’re still talking about fewer than one in five brokers; furthermore, we don’t know whether these brokers have actually changed aggregators.

Frustratingly, this result tells us nothing about the remaining four out of five brokers and whether they think their aggregator is doing something right, or believe it’s simply too difficult to move.

It comes as no surprise that most brokers are pushed to leave their aggregators because

HOW LIKELY ARE YOU TO CHANGE AGGREGATORS IN THE NEXT 12 MONTHS? 80% 70%

*Note: In 2015 we used the word ‘very’ rather than ‘extremely’

2015

60% 50%

2016

40% 30% 20% 10% 0%

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2015 Extremely unlikely

2016

Unlikely

2015

2016

Neutral

2015

2016

Likely

2015

2016

Extremely likely

that simply looks worse than a newer, better system being introduced by a competitor.

In many cases brokers complained about this relative failure of their systems. One Connective broker recalled that they had “changed to Connective 2 years ago in search of a better IT platform and compliance support. I am much more organized now and am making more money”.

Raising brokers’ expectations when it comes to IT and other systems can backfire, however: one AFG broker complained that their aggregator’s SMART marketing system was too expensive for them as they had a small loan book.

Given the importance of IT, it’s no surprise that newer aggregators such as My Local Broker are promoting their technological know-how to brokers. To actually get members through the door, however, they will have to make it easier to switch systems, as data migration/IT issues are the biggest deterrent to brokers switching aggregators, bigger even than contractual obligations.

Brokers simply cannot afford to spend time away from their businesses, particularly brokers setting up their own firms. As one AFG member explained, “I made the decision to start my own company with AFG. AFG made the process as smooth as possible and I was up and running VERY quickly”. In this case it was a BDM – not advanced technology – which made the move easy, a reminder that technology can’t always be separated from other areas of service.

By breaking down likeliness to leave by

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volume, age and income statistics, we were able to produce a profile of the broker most likely to leave their aggregator (see box below).

When you combine this with the brokers’ comments, these numbers start to make

building a business; incompetent BDMs. It’s much easier for aggregators to fix these obvious problems than it is for them to be the ‘best’ in every single category – which means it’s entirely possible to reduce their outgoing broker numbers to close to zero.

“We have our own proven systems in place and continue to explore outside options as current marketing material and processes are very limited with [our] aggregator”

THE IMPORTANCE OF I.T.

36%

Poor IT and CRM support is the biggest reason to leave

Plan broker more sense. These brokers are writing decent volumes and are no longer beginners, but are not yet seeing the financial returns for the work, often because of a poor commission split; essentially they have outgrown their aggregators.

Correspondingly, national franchises came in for particularly harsh criticism in our survey: one YBR broker complained that the “remuneration model [is] unsustainable with minimum KPIs & disproportionate commission split”. It’s important to note that this survey is not about franchises; we use these comments to explain why brokers move from a branded to a more traditional aggregator model.

What’s most evident about brokers that leave is that the problems they face are quite severe: IT systems that don’t work; commission splits that prevent them from

WHO IS MOST LIKELY TO LEAVE? By breaking down the likeliness to leave by demographic segments, we’ve worked out which type of broker is most likely to leave:

28%

Data migration /IT issues are the biggest obstacle to leaving

Aged

36–45 Has an annual volume of

$10–$20m

17%

Earns

$0–$50,000 Bear in mind, however, that this broker is only 15% more likely to leave than an ‘average’ broker, and is still ‘unlikely to leave’, with a score of 2.39

IT and CRM support is the biggest reason for brokers to pick their ‘alternative’ aggregator* *We asked brokers: if they had to change aggregators, who they’d choose and why

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THE STAR SYDNEY, 21 OCTOBER 2016

AWARD SPONSORS

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EVENT PARTNER

We present the industry leaders and pioneers who made the shortlist for the 15th Australian Mortgage Awards FOR 15 years the Australian Mortgage Awards have been celebrating the industry’s finest, through the GFC, the NCCP and the rise of the Web. This year, on 21 October, The Star Sydney will play host to an extraspecial evening of entertainment, networking, and of course trophies.

As the ‘Oscars of the Mortgage Industry’, the AMAs remain the most prestigious awards presented to mortgage and finance professionals in Australia, including brokers, brokerages and lenders. Getting one’s hands on one of the 27 trophies is therefore extremely difficult: with a record number of nominations this year, simply making this list of finalists is an achievement to be celebrated.

Over a decade and a half, the AMAs have evolved to reflect the industry, and this year is no exception. Two more awards have been added: Aggregator of the Year (<500 Brokers) and Aggregator of the Year (>500 Brokers). The criteria for these new awards come from your feedback in our Brokers on Aggregators survey: accuracy and timeliness in commission payment, quality of lending panel, IT and CRM support, broker communication, BDM support, compliance support, training and education, and lead generation.

The biggest awards are decided on the night: those for Australian BDM, Young Gun, Brokerage and Broker of the Year. Becoming a finalist for one of these big four awards requires winning another category. Please refer to each category within this feature for details of eligible categories and judging criteria.

MPA is proud to present the outstanding professionals who have earned the respect of the industry and made it into this year’s list of finalists. Along with our publisher, Key Media, we’d like to thank all those who submitted nominations this year, and all our sponsors who make the AMAs a success.

We look forward to celebrating your success at The Star Sydney on Friday 21 October.

A MESSAGE FROM OUR EVENT PARTNER Westpac is proud to return as the official partner of the Australian Mortgage Awards. In its 15th year, the Awards continue to be the highlight of the mortgage industry calendar, and provide an important opportunity for our industry to recognise those that have achieved excellence throughout the year. Westpac is thrilled to support the Awards and recognise service excellence and leadership across the industry. Like many of you, Westpac understands what it takes to be a leader – success to us is growing stronger and deeper relationships as One Team so that brokers can experience the direct benefits of Westpac’s tailored services and banking solutions. Congratulations to all the award finalists nominated in 2016 – winning an AMA is a career-defining moment for mortgage and finance professionals in Australia and we wish you the best of luck on the night.

Tony MacRae General manager, third party distribution, Westpac Group

OFFICIAL PUBLICATIONS

ORGANISED BY

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AUSTRALIAN MORTGAGE AWARDS FINALISTS 2O16 BEST NON-BANK BDM

BEST NON-MAJOR BANK BDM

BEST MAJOR BANK BDM

This award recognises the non-bank BDM who has displayed excellence over the past 12 months. Criteria include how accessible the nominated BDM is; the BDM’s understanding of their brokers’ businesses; product knowledge; and whether the BDM adds value to the brand he/she represents and the broker channel.

This award recognises the non-major bank BDM who has displayed excellence over the past 12 months. Criteria include how accessible the nominated BDM is; the BDM’s understanding of their brokers’ businesses; product knowledge; and whether the BDM adds value to the brand he/she represents and the broker channel.

This award recognises the major bank BDM who has displayed excellence over the past 12 months. Criteria include how accessible the nominated BDM is; the BDM’s understanding of their brokers’ businesses; product knowledge; and whether the BDM adds value to the brand he/she represents and the broker channel.

FINALISTS

FINALISTS

FINALISTS

• Karen Kay, Advantedge Financial Services

• Robert Thomas, AMP Bank

• James Higgs, ANZ

• Christopher-Lee Emanuel, Bank of Melbourne

• John Kakakios, ANZ

• Trent Clyne, Bankwest

• Ian Jeffries, Commonwealth Bank of Australia

• Rachel Walsh, Virgin Money • Lili Amphone, Australian First Mortgage • Anusha Haran, Bluestone Mortgages

• Heather Gallagher, Bank of Queensland • Stuart Moore, ING DIRECT

• Andrew Crossley, Homeloans Ltd

• John Loukadellis, Macquarie Bank

• Jasmine Kourouche, Homeloans Ltd

• Emily Farrell, Macquarie Bank

• Alf Vasta, Liberty • Diane Robinson, Pepper Money • Natalie Pavlovich, Pepper Money

• Sally Hillman, St. George Bank • Dino Pacella, Suncorp Bank • Romney Ferguson, Suncorp Bank

• Rick Pudsey, ANZ

• Keryn McLennan, Commonwealth Bank of Australia • Erin Williams, National Australia Bank • Susan Kennedy, National Australia Bank • Glenn Howlett, Westpac • Shannon Gibbons, Westpac

• Darren Stratford, RESIMAC • Kama Atcheson, Pepper Money

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BANKWEST BEST AGGREGATOR BDM This award recognises the aggregator BDM who has displayed excellence over the past 12 months. Criteria include how accessible the nominated BDM is; the BDM’s understanding of their brokers’ businesses; product knowledge; whether the BDM adds value to the brand he/she represents and the broker channel.

FINALISTS

AFM BEST CUSTOMER SERVICE FROM AN INDIVIDUAL OFFICE

COMMONWEALTH BANK BROKER OF THE YEAR – PRODUCTIVITY

This award recognises the brokerage office or branch that has displayed excellence in their customer service over the past 12 months. Criteria include product knowledge, product offering, and quality of service over the phone or face-to-face.

This award recognises the broker who has focused on productivity improvements. Criteria include percentage of applications submitted and that proceeded without questions or delays, year-over-year growth, percentage of applications approved for funding and handled without escalations.

FINALISTS • Astute Ability Group

FINALISTS

• Chris Straw, AFG

• Home Loan Connexion

• Fiona Brown, Connective

• Intelligent Finance

• Moshe Moses, Astute Sydney City Central

• Justine Hockley, Connective

• Intuitive Finance

• Nick Dalamagas, eChoice

• KeyInvest Lending Services

• Mark Lewis, FAST

• Link Finance Group

• Damien Thompson, Finsure

• Loan Market Townsville City

• Suzi Trajanovski, Loan Market Victoria

• Smartmove Professional Mortgage Advisors

• Helen Taylor, PLAN Australia

• Violeta Finance

• Peter Bryant, Vow Financial

• George Karam, Byblos Finance • Griffin Czipri, eChoice • Justin Doobov, Intelligent Finance • Will Rademeyer, Mortgage Box • Oliver Li, Option Finance Australia Pty Ltd • Joel Wyld, Peasy • Daniel O’Brien, PFS Financial Services • Ismail Ozsoy, Touch of Finance

AWARD SPONSOR

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AUSTRALIAN MORTGAGE AWARDS FINALISTS 2O16 MOST EFFECTIVE INTERNET PRESENCE

BEST INDUSTRY ADVERTISING CAMPAIGN

This category recognises the organisation within the mortgage industry that has best harnessed this medium to provide brokers with practical, effective and easily accessible facilities to help them with their business. Criteria include the business’s key objectives behind the website, and its design, functionality, features and quality of content.

This award recognises the best below the line (B2B) advertising campaign conducted by any organisation within the mortgage industry (marketing to brokers). Judges look at an overview of the campaign’s strategy, the marketing mix applied, and quantitative and qualitative evidence of cut-through and campaign results where possible.

This award recognises the broker or brokerage that has demonstrated outstanding service or contribution to their local community over a sustained period of time, or has had a significant positive impact on their local community.

FINALISTS

FINALISTS

• Astute Ability Group

• ARG Finance

• ANZ

• Cairns Mortgage Brokers

• La Trobe Financial

• Entourage Finance

• Liberty

• Go Mortgage Corporation

• NAB Broker

• N1 Loans – LoanRobot.com.au and Chengdai.com.au

• Pepper Money

BEST COMMUNITY ENGAGEMENT

FINALISTS • 1st Street Pty Ltd • Beach Finance • Cairns Mortgage Brokers • Mortgage Success Pty Ltd • Pink Finance • Violeta Finance

• Suncorp Bank

• Naked Loans • Violeta Finance

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BEST INDUSTRY SERVICE This award recognises the service provider that adds the most value to their customers’ businesses. Criteria include the service provider’s value proposition, the industry’s need for the service, how the service has added value, and overall commitment of the organisation to its customers.

FINALISTS • Boutique Outsource Solutions • Breezedocs • CoreLogic • Loanworks Technologies • NextGen.Net

AGGREGATOR OF THE YEAR (<500 BROKERS)

AGGREGATOR OF THE YEAR (>500 BROKERS)

Aggregators are the most important link between mortgage brokers and lenders.

This award recognises the bestperforming aggregator (less than 500 brokers). Criteria include accuracy and timeliness in commission payment, quality of lending panel, IT and CRM support, broker communication, BDM support, compliance support, training and education, and lead generation.

Aggregators are the most important link between mortgage brokers and lenders.

This award recognises the bestperforming major aggregator (over 500 brokers). Criteria include accuracy and timeliness in commission payment, quality of lending panel, IT and CRM support, broker communication, BDM support, compliance support, training and education, and lead generation.

FINALISTS

FINALISTS

• Astute Financial Management

• Choice Aggregation Services

• Buyers Choice Home Loan Advisory Service

• Connective

• eChoice

• Finsure Finance and Insurance

• Finconnect (Australia) Pty Ltd

• Vow Financial

• FAST

• KeyInvest Lending Services • Loan Market • Outsource Financial • Specialist Finance Group

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AUSTRALIAN MORTGAGE AWARDS FINALISTS 2O16 QUALITY YOUNG GUN OF THE YEAR – INDEPENDENT

This award recognises the broker who has displayed excellence in their first two years of operation in the mortgage industry as a broker. Criteria include loan volumes, quality of submissions, conversion rates and overall customer service.

This award recognises the broker who has displayed excellence in their first two years of operation in the mortgage industry as a broker. Criteria include loan volumes, quality of submissions, conversion rates and overall customer service.

FINALISTS

FINALISTS

This award recognises the broker that provides insurance (mortgage protection and life) who has displayed excellence over the past 12 months. Criteria include quality of submissions, conversion rates, the broker’s ability to demonstrate a positive attitude towards mortgage protection and life insurance, and their role as an advocate within the industry.

• Christopher Franklin, Aussie Home Loans Gisborne

• Weng Wong, Equatorial Finance Solutions

FINALISTS

• Lee Wisniewski, Loan Market

• Matthew Posselt, Iconic Home Loans

• Nelson Bedoya, Loan Market • Sharon Bal, Loan Market • Alex Politis, RAMS Home Loans Adelaide Central • Gavin Tandon, Smartline Home Loans • Sze Chuah, Yellow Brick Road Parramatta • Hung Chuy, Yellow Brick Road Randwick

• Steven Ryan, INTERSTELLAR Finance • Harry Favetti, Shore Financial • Paris Galombik, Shore Financial • Mitchell Shad, Smartmove Professional Mortgage Advisors • Natasha Choi, The Australian Lending & Investment Centre • Chris Huynh, The Financiers Group • Carl Violeta, Violeta Finance • Yuval Bloomfield, 1st Street Pty Ltd

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ALI GROUP BROKER OF THE YEAR - INSURANCE

QUALITY YOUNG GUN OF THE YEAR – FRANCHISE

(MORTGAGE PROTECTION AND LIFE)

• Kathy Doherty, Aussie Home Loans • Rochelle Hall, Aussie Home Loans Strathpine • Nicholas Kakalis, Finance Unlimited • Steven James, Astute Financial Townsville • Maxine Farmer, Maxon Finance Pty Ltd • Terry Hill, Queensland Financial Services Pty Ltd • Martin Ireland, Resolve Finance AWARD SPONSOR

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PEPPER BROKER OF THE YEAR – NON-CONFORMING

ANZ BROKER OF THE YEAR – COMMERCIAL

FBAA BROKER OF THE YEAR – INDEPENDENT

This award recognises the broker in the non-conforming category who has displayed excellence over the past 12 months. Criteria include quality of submissions, conversion rates, overall customer service and, to a lesser extent, loan volumes.

This award recognises the broker in an independent operation who has displayed excellence over the past 12 months. Criteria include loan volumes, year-over-year growth, quality of submissions, conversion rates and overall customer service.

FINALISTS

This award recognises the broker who specialises in commercial real estate, investment finance, SME/debtor finance, and asset and leasing finance who has displayed excellence over the past 12 months. Criteria include loan volumes, year-over-year growth, quality of submissions, conversion rates and residential to commercial lending ratios.

• Stuart Styles, Arthurmac & Co Pty Ltd

FINALISTS

• Benjamin Hennessey, Aussie Home Loans Dapto

• David Kimmorley, Balmain Commercial Canberra

• George Karam, Byblos Finance

• George Karam, Byblos Finance

• Giulio Avian, Fundsnational Pty Ltd

• Daniel Green, Green Finance Group

• Oliver Li, Option Finance Australia Pty Ltd • Abraham Tuckett, PTR Property Finance • Bryan Gregory Freemantle, Wealth First Lending Pty Ltd

AWARD SPONSOR

• Dan Holden, HoldenCAPITAL • Ren Hor Wong, N1 Loans • Daniel O’Brien, PFS Financial Services • Jayden Vecchio, Red & Co

AWARD SPONSOR

FINALISTS • George Karam, Byblos Finance • Justin Doobov, Intelligent Finance • Andrew Mirams, Intuitive Finance • Colin Lamb, Mortgage & Finance Solutions • Joel Wyld, Peasy • Daniel O’Brien, PFS Financial Services • Theo Chambers, Shore Financial • Kevin Agent, The Australian Lending & Investment Centre • Mark Davis, The Australian Lending & Investment Centre AWARD SPONSOR

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AUSTRALIAN MORTGAGE AWARDS FINALISTS 2O16 NEXTGEN.NET NEW BROKERAGE OF THE YEAR

BROKERAGE OF THE YEAR – DIVERSIFICATION

BROKERAGE OF THE YEAR FRANCHISE

This award recognises the best brokerage office or branch that has been in operation for two years or less.

Criteria include loan volumes, year-on-year growth, quality of submissions, conversion rates, customer service proposition, the business’s value proposition and strategy around stakeholder engagement.

This award recognises the brokerage that has implemented the most effective diversification business model. Criteria include products and services offered, year-on-year growth, how the diversification offering has impacted on business growth over the past 12 months, customer service proposition, the business’s value proposition and strategy around stakeholder engagement.

This award will recognise a franchise brokerage operation for displaying excellence in the past 12 months.

Criteria include loan volumes, year-on-year growth, quality of submissions, conversion rates and overall customer service.

FINALISTS

FINALISTS

• Choice Home Loans North Parramatta

• Cairns Mortgage Brokers

• Assured Home Loans

• Loan Market Bayside

• Entourage Finance

• Astute Sydney City Central

• Loan Market Chermside

• Equatorial Finance Solutions

• Finance Made Easy

• Mortgage Choice Buderim

• Hunterwood Solutions

• Green Finance Group

• Yellow Brick Road West End

• Peasy

• Hunterwood Solutions

• Right Angle Home Loans

• N1 Loans

• The Financiers Group

• Shore Financial

FINALISTS • Century21

• VIP Mortgage Solutions

AWARD SPONSOR

Rachelle Eyndhoven Sphere Finance Pty Ltd

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The Australian Lending & Investment Centre

Peita Davies Choice Home Loans Blue Mountains

Damien Roylance Entourage Finance

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e nce

EVENT PARTNER

ANZ BROKERAGE OF THE YEAR (≤5 STAFF) – INDEPENDENT This award recognises the small brokerage operation that has displayed excellence over the past 12 months. Criteria include overall business perspective: loan volumes, year-on-year growth, quality of submissions, conversion rates, customer service proposition, the business’s value proposition and strategy around stakeholder engagement.

FINALISTS

ME BROKERAGE OF THE YEAR (≥6 STAFF) – INDEPENDENT This award recognises the larger brokerage operation that has displayed excellence over the past 12 months. Criteria include overall business perspective: loan volumes, year-on-year growth, quality of submissions, conversion rates, customer service proposition, the business’s value proposition and strategy around stakeholder engagement.

FINALISTS • 1st Street Pty Ltd

• Astute Ability Group

• Acceptance Finance

• Lending4U

• Astute Sydney City Central

• Mortgage & Finance Solutions

• Green Finance Group

• PFS Financial Services

• Iconic Home Loans

• Priority Home Loans

• N1 Loans

• The Financiers Group

• Oxygen Home Loans

• Touch of Finance

• Shore Financial

• Unique Finance Services

• Smartmove Professional Mortgage Advisors • The Australian Lending & Investment Centre

AWARD SPONSOR

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AUSTRALIAN MORTGAGE AWARDS FINALISTS 2O16

EVENT PARTNER

TO BE ANNOUNCED ON THE NIGHT…

AUSTRALIAN BDM OF THE YEAR

NAB AUSTRALIAN BROKERAGE OF THE YEAR

This award recognises the BDM who has displayed extraordinary performance over the past 12 months, and is one of the highest accolades offered to a BDM in the mortgage industry. The finalists in this category comprise the winners of the individual BDM categories (Best Major Bank BDM, Best Non-Major Bank BDM, Best Non-Bank BDM and Best Aggregator BDM).

This award recognises the brokerage that has displayed extraordinary performance over the past 12 months, and is one of the highest accolades offered to a brokerage business in the mortgage industry. The finalists in this category comprise the winners of the brokerage categories (Brokerage of the Year ≤5 Staff – Independent; Brokerage of the Year ≥6 Staff – Independent; Brokerage of the Year – Franchise; Brokerage of the Year – Diversification; and New Brokerage of the Year).

AWARD SPONSOR

COMMONWEALTH BANK AUSTRALIAN YOUNG GUN OF THE YEAR

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WESTPAC AUSTRALIAN BROKER OF THE YEAR

This award recognises the broker who has displayed excellence in their first two years in the mortgage industry as a broker. The finalists in this category comprise the winners of the individual Young Gun categories (Quality Young Gun of the Year – Franchise and Quality Young Gun of the Year – Independent).

This award recognises the mortgage broker who has displayed extraordinary performance over the past 12 months, and is one of the highest accolades offered to an individual in the mortgage industry. The finalists in this category comprise the winners of the individual broker categories (Broker of the Year – Productivity; Broker of the Year – Insurance (Mortgage Protection & Life); Broker of the Year – Independent; Broker of the Year – Non-Conforming; and Broker of the Year – Finance).

AWARD SPONSOR

AWARD SPONSOR

F

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MPA_to

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AUSTRALIAN MORTGAGE AWARDS FINALISTS 2O16 EVENT PARTNER

Westpac is Australia’s first bank and first company, with 199 years’ experience helping customers to achieve their financial goals through good times and bad. We’re into today and we don’t live in the past.

Our vision at Westpac is to be the No. 1 lender for overall broker service and value in Australia.

We’re One Team that is helping you grow more opportunities so that you can strengthen your proposition to your clients.

We are Westpac. One bank, One Team.

Contact your Westpac BDM 1300 130 467 westpacbrokerbase.com.au

BROUGHT TO YOU BY

Key Media organises leading industry awards and professional development events in association with our leading magazine titles. These include the Australasian Law Awards, Australian HR Awards, Australian Mortgage Awards and the National HR Summit series.

Contact 02 9439 4566 www.keymedia.com.au

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AWARD SPONSORS

Established in 2003, AFM is an Australian owned, award-winning, non-bank mortgage manager, offering competitive residential, commercial and leasing finance. AFM is one of Australia’s fastest-growing non-bank lenders.

The company is funded by Australian banks and wholesale lending institutions, including Bendigo and Adelaide Bank, NAB’s Advantedge Financial Services, Resimac and Pepper Home Loans.

Contact Natasha Sultan, Head of Sales 0448 090 905 natasha@afm.com.au www.afm.com.au

ALI Group is the market leader in providing loan and mortgage protection products to the mortgage broking industry, with over 3,500 brokers authorised to offer their clients loan protection.

Our mission is to ensure all Australian home and property borrowers are protected.

Contact 1800 006 776 service@aligroup.com.au www.aligroup.com.au

At ANZ, we understand commitment. We see brokers as valued partners and firmly believe in helping you help your customers.

With 20 years supporting the broker industry, we look forward to continuing to

improve our overall service proposition to ensure we meet the changing needs of our brokers and customers – both in residential and commercial.

Speak to your ANZ BDM today 1800 812 785 www.anz.com/small-business/broker/ mortgages/contact-us/

The mortgage broking industry reads it first in Australian Broker, the market’s only truly dedicated news magazine and website.

Firmly established as the most reliable and independent news source for brokers, regular features include news, opinion, market analysis, leading broker profiles, sales and marketing insights, broker toolkits, plus a unique focus on the personalities that make up this dynamic industry.

Contact Madelin Tomelty, editor 02 8437 4792 madelin.tomelty@keymedia.com.au

Bankwest was one of the first banks to support the broker channel and we will continue to work closely with brokers and their customers. We’re committed to delivering what matters to brokers and customers and will continue to offer innovative, competitive products that make us stand out from our competitors.

Contact: Stewart Saunders, General Manager Broker Sales 0475 980 011 stewart.saunders@bankwest.com.au www.bankwest.com.au

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that look after the retirement savings of everyday Australians.

Commonwealth Bank has helped more Australians buy their own home than any other bank. When it comes to finding the right home loan for your customer, it pays to partner with a bank that ticks all the boxes. From expert relationship managers to market-leading technology, you can rest assured we’ve got you covered.

Contact Steph Kay, Senior Communications Manager 0416 255 934 steph.kay@live.com.au www.commbroker.com.au

The Finance Brokers Association of Australia Limited (FBAA) has been the national voice for brokers since 1992. Fighting hard for the rights of finance professionals, committed to the growth of the finance industry. The FBAA empowers its members by giving them the tools they need to grow their business.

Contact Leah Renwick, Business Development Manager 07 3041 0350/0401 929 176 leah@fbaa.com.au www.fbaa.com.au

Contact Lino Pelaccia, GM Broker 0434 322 010 lino.pelaccia@mebank.com.au mebank.com.au

Mortgage Professional Australia (MPA) is the leading business magazine for the mortgage and finance industry. Launched in 2001, MPA continues to be the key resource mortgage and finance professionals turn to for in-depth industry issues, market trends, business analysis and intelligence.

Contact Sam Richardson, editor 02 8437 4720 sam.richardson@keymedia.com.au

At NAB we understand that every loan matters because it has the potential to create a home, build a business or achieve a dream. Our broker channel is uniquely positioned to provide brokers with the tools and support they need to help their customers.

Contact 1300 622 276/1300 622 276 brokerservices@nab.com.au www.nabbroker.com.au

Australians deserve to get the most out of their money. We’re here to help you get more from your savings and pay less on your loans.

Owned by industry super funds, our profits stay local, with the organisations

products and services to a range of banks, non-bank lenders and brokers. Our objective is to provide smarter solutions for now and what’s next – delivering best-in-class Software as a Service (SaaS) and leading the market in quality management and processing efficiencies.

Contact: Tony Carn, Sales Director sales@nextgen.net 02 9929 5999 www.nextgen.net

Pepper Money is an Australian owned, people focused lender providing home loans, car loans, equipment finance and personal loans.

Whatever your client’s circumstances, we take a uniquely flexible, human approach assessing each situation individually. We’ve been awarded Best Specialist Lender four years in a row and Best Self-Employed Lender for two years in a row.At Pepper Money we’re about discovering new ways to finance ambition. Talk to us today about what you want to achieve.

Contact Annette McElhinney, Channel Marketing Manager 1800 737 737 amcelhinney@pepper.com.au pepper.com.au/broker

NextGen.Net Pty Ltd is Australia’s leading technology solution provider to the lending industry, focused on delivering quality

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UPFRONT

CAREER PATH

THE ROAD TO THE CHAIR MFAA chairman Cynthia Grisbrook has gone from banking and electricity to broking and industry advocacy

1991 FINANCE

Leaves university and begins career at ANZ Bank, later moving to the bank’s treasury as a money market dealer. Despite coming from a family of chartered accountants, owning her own business was “not on the cards at all”, recalls Grisbrook.

2001

SETS UP DLV

After a brief stint working for another broker, Grisbrook and her business partner set up DLV Finance Solutions. She was determined to treat the brokerage as a business, so costs, remuneration and lifestyle were budgeted from day one.

1994

BRIGHT SPARK Went into the electricity business as a wholesale product manager at Pulse Energy, dealing with large corporations, shopping centres and even abattoirs, but Grisbrook missed dealing with mum-and-dad clients.

“Anything you want to know about an abattoir I can probably tell you!”

2009

NCCP ACT

“We had some very good advice: if you’re going to go into it, it’s a business; treat it as a business”

The introduction of the NCCP made deals tougher. DLV had already been under the Victorian Brokers Contract and, as Grisbrook recalls, “my checklist that I set up 16 years ago hasn’t changed”.

2011

JOINS MFAA BOARD

Grisbrook joined the MFAA board at a time of turmoil, when the association’s purpose was under question. In 2013 she became deputy chairman, working with Tim Brown, who was then president of the MFAA.

“If you want something done then you need to take responsibility and accountability for that… and the only way you can do something about it is to get involved” 62

2015

APPOINTED CHAIRMAN Grisbrook’s appointment as MFAA chairman was accompanied by a wider shift to guarantee a broker majority on the smaller seven-strong MFAA board. She’s since overseen the MFAA 2020 Conference, and at the time of writing was on the lookout for a new MFAA CEO – all while continuing to run DLV Finance Solutions.

www.mpamagazine.com.au

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Justin Doobov Intelligent Finance AUSTRALIAN BROKER OF THE YEAR 2015

FRIDAY 21 OCTOBER 2016 | THE STAR SYDNEY www.australianmortgageawards.com.au Event partner

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PEOPLE

OTHER LIFE

www.probonoaustralia.com.au Pro Bono Australia has a number of guides on how professionals can use their skills for good, plus a searchable database of opportunities.

It also organises events and webinars.

THE POWER IN YOUR HANDS YBR broker Zaheer Lalani puts his financial expertise to good use, helping some of the world’s poorest people WEDDINGS ARE stressful enough as it is, wining and dining dozens of guests. But how about feeding 2,000? That’s what Yellow Brick Road broker Zaheer Lalani and his wife Sajda managed at their wedding – not as an act of extravagance but instead to help 2,000 of the most impoverished people in one of the world’s poorest countries, Pakistan.

It was wedding planning with a difference, Lalani explains. “We were thinking what we could do to not only enjoy the wedding but also give something back in return.”

Lalani is principal at YBR Blacktown, and his wedding was the culmination of 20 years of work with the Edhi Foundation,

64

a major charity in Pakistan that provides everything from ambulances to marriage counselling. “The Edhi foundation in Pakistan is a household name,” Lalani explains. “The founder, Abdul Sattar Edhi, is basically known as the father of Pakistan.”

Edhi, who passed away in July this year, was praised by Prime Minister Nawaz Sharif as “a great servant of humanity”.

Lalani, who is from Sydney, began his charitable work in Australia, using the skills he’d learned as a businessman to help the Edhi Foundation – “mapping out a strategy plan as far as Australia was concerned”.

International volunteering was not initially on the agenda, explains Lalani. “I started

with the Edhi Foundation at a local level, and then ended up doing this at a global level.”

For brokers who want to do charitable work, Lalani advises them to start local.

“You’ve got to make sure your house is in order … [if] you’ve done whatever you can do there and you’d like to do more, then there’s a million and one organisations.”

Nor should brokers and financial planners underestimate how much their skill sets can help. “I’ve done a lot of pro bono work for clients; if that’s all you can do to give back, then do that. When it comes to charity it’s not just about giving a monetary donation; the whole concept of giving your time and knowledge to people is just as important.”

www.mpamagazine.com.au

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