MPAMAGAZINE.COM.AU ISSUE 19.03
BROKERS ON BANKS
Bankwest rewarded for turnaround times THE NEW MAINSTREAM The challenges and opportunities that lie ahead for fintechs
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DEVIL’S IN THE DETAIL ING’s Glenn Gibson on broker wellbeing in the current climate
IS OUTSOURCING FOR YOU? How to get your time back so you can work to grow your business
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MARCH 2019
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 02 Editorial
The industry shows its resilience
04 Statistics
18
34 FEATURES
FINTECH ROUNDTABLE
How fintechs are seeing the opportunity to become known as mainstream lenders
BROKERS ON BANKS
ING’s head of third party discusses the current environment and how brokers need to focus on their wellbeing
12
How brokers and banks should work better together
08 News analysis
As the RBA holds the cash rate, brokers are concerned about interest rate ‘creep’
10 Opinion
RateSetter’s Mark Woolnough on the current broker landscape
50 Broker tech
We look at which banks you think have been coming out on top and which ones are not. Read on for the big reveal!
GLENN GIBSON
06 Head to head
FEATURES
SPECIAL REPORT
THE BIG INTERVIEW
The comfort gap between property owners and renters is closing
Pepper is evolving with the times to provide the right tools for brokers
42 FEATURES
OUTSOURCING
Why brokers are looking further afield for help with their businesses, and how you can too
48 FEATURES
SELF-EMPLOYED BORROWERS
Bluestone explains the opportunities this segment offers brokers
PEOPLE 52 Brokerage insight
One brokerage on helping customers tackle current market challenges
54 Career path
The road Greg Paramor took to becoming a key influencer in the property market
56 Other life
A broker uses Jiu-Jitsu to unleash her competitive side
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UPFRONT
EDITOR’S LETTER www.mpamagazine.com.au MARCH 2019
Nothing more constant than change
S
o marks the end of my first full month as editor of MPA, and what a month it’s been. This issue is packed full of content, with analysis, interviews, roundtables and survey results. Despite knowing more than we did two months ago – or even a month ago – there is still uncertainty over what will really happen in the industry’s future. During my interview with ING head of third party Glenn Gibson (page 12), he made the point that “nothing is more constant than change”. While the future is still cloudy, and we know brokers are going to face a change of some sort, it is not the first time change has happened. A broker who took part in MPA’s Fintech Roundtable (page 34) also said with confidence, “With adversity, there is opportunity”. And from my conversations with brokers over the past month I can see that strong broker resilience shining through. Many of you are already working on how you can get your businesses prepared for when things do change. It is not the last time change will occur, but you will continue
From my conversations with brokers over the past month I can see that strong broker resilience shining through to grow and adapt to overcome the next challenge too. There’s a lot going on, but another big talking point for us this month is our 2019 Brokers on Banks survey. We asked you how you rated the different banks in areas such as product and pricing, turnaround times and interest rates. We have full in-depth coverage of each of these areas, looking at which banks came out on top and what you had to say about them. In some areas the results are reflective of what we have been seeing over the past year, although not in all. It was very exciting to see for the first time in Brokers on Banks history a non-major appearing in the top three, having leapt from sixth position last year. Our Fintech Roundtable in February was another great session full of lots of discussion around how brokers and fintechs are working together and what can be done to improve in the future, as well as a bit of friendly AFL chat afterwards.
EDITORIAL
SALES & MARKETING
Editor Rebecca Pike
National Sales Manager Claire Tan
Journalists Edward Cranswick, Tom Goodwin, Abel Riototar Contributor Mark Woolnough Production Editor Roslyn Meredith
ART & PRODUCTION Designer Cess Rodriguez Traffic Coordinator Freya Demegilio
Marketing Manager Danica Mendoza
CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley Managing Director Justin Kennedy Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil
EDITORIAL ENQUIRIES
tel: +612 8437 4784 rebecca.pike@keymedia.com
SUBSCRIPTION ENQUIRIES
tel: +61 2 8311 5831 • fax: +61 2 8437 4753 subscriptions@keymedia.com.au
ADVERTISING ENQUIRIES claire.tan@keymedia.com
Key Media Regional head office Level 10, 1–9 Chandos St, St Leonards, NSW 2065, Australia tel: +61 2 8437 4700 • fax: +61 2 9439 4599 www.keymedia.com Offices in Sydney, Auckland, Denver, London, Toronto, Manila, Singapore, Bengaluru, Seoul
Mortgage Professional Australia is part of an international family of B2B publications and websites for the mortgage industry CANADIAN MORTGAGE PROFESSIONAL neil.sharma@kmimedia.ca T +1 416 644 8740
Rebecca Pike, editor, MPA 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
STATISTICS MORTGAGE VS RENT
Narrowing the gap
The financial comfort of renters increased by 8% to 4.78 out of 10, the highest level in four years, while the financial comfort of households paying a mortgage rose only 4% to 5.51. However, compared to both owner-occupiers paying off a mortgage and homeowners who own their home outright, renters had lower levels of comfort across most areas, including cash savings and investment.
The comfort gap between property owners and renters may be closing, but cash-saving efforts could be delaying economic growth WITH MOST households feeling better about their finances despite the falling property and share markets, the comfort gap between homeowners and renters has narrowed for the first time in seven years, according to ME’s bi-annual Household Financial Comfort Report. Surveying 1,500 households across Australia in December 2018, the report revealed that income gains, easing living costs, increased savings and reduced overspending were primary drivers of rising financial comfort, but belt-
Overall financial comfort of households with and without mortgages
tightening could be slowing economic growth. “We’ve seen a correction for wealthier, older property-owning Australians who’ve been riding the hot property and bull share markets for much of the past seven years, while middle and lower-income households have begun to benefit from an easing in living cost pressures and income gains,” ME consulting economist Jeff Oughton said. “Together the changes have helped to narrow the big gap in financial comfort that had been widening.”
7.0 6.0 5.0 4.0 3.0 2.0 1.0 0
7%
of households missed mortgage payment due to lack of funds
6.6/10
$862
rating given by households for ability to pay regular expenses
5.19
6.63
6.20
Owneroccupier mortgage
Owneroccupier & investor mortgage
Investment mortgage
6.27 Own home/no mortgage
13%
is estimated average amount savers of homeowners expect put away each month their property value to fall in 2019 Source: ME Household Financial Comfort Report, December 2018
COMFORT TREND SHIFTS UPWARDS
LESS INCOME GOING TO MORTGAGE
Changes in the Household Financial Comfort Index
Percentage of household disposable income paid towards mortgage
The Household Financial Comfort Index moved up by 2% to 5.56 out of 10, higher than in the past five surveys. Of all the households, those with ‘low’ levels of comfort showed a big increase in overall comfort.
During the survey period, the proportion of households paying more than 30% of their disposable income towards their rent or mortgage fell significantly, from 56% to 47%. About 75% of households with incomes below $40,000 per annum experience mortgage stress. Dec 2017
Jun 2018
Dec 2018
35% 5.59
30% 5.51
5.49 5.56
5.41
29% 24%
22% 23% 20%
20%
5.44
5.41
25%
31%
15%
5.37
12%
10% Household Financial Comfort Index
Long-term average
Dec 15
Jun 16
Dec 16
Jun 17
Dec 17
Jun 18
Dec 18
Source: ME Household Financial Comfort Report, December 2018
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10%
8% 6% 6%
5% 0%
Jun 15
13%
More than 20% up to 30%
More than 30% up to 40%
More than 40% up to 50%
4%
More than 50% up to 60%
7% 4%
Greater than 60%
Source: ME Household Financial Comfort Report, December 2018
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Overall financial comfort based on housing 7.0 6.5 6.0 5.5 5.0 4.5 4.0 Oct 11
Jun 12
Dec 12
Jun 13
Dec 13
Jun 14
Dec 14
Jun 15
Dec 15
Jun 16
Dec 16
Jun 17
Dec 17
Own home outright
Paying off mortgage
Rent
Long-term trend
Long-term trend
Long-term trend
Jun 18
Dec 18
Source: ME Household Financial Comfort Report, December 2018
ABILITY TO SETTLE DEBT IMPROVES
EXPECTATIONS LOOKING UP
Only 7% of households were unable to pay their mortgage on time last year due to being short of money. Just 8% could not pay their rent promptly, and 12% were unable to pay their personal loan or credit card on time.
Thirty-eight per cent of households expect their home values to climb in 2019, while 53% of investors with a mortgage believe the value of their investment properties will rise. What will likely happen to your property’s value in the next 12 months?
Ability to manage debt
40%
Can pay a little bit more than the minimum payments on my debt
35% 30%
32%
Can just manage to make minimum payments on my debt
25%
Can pay a lot more than the minimum payments on my debt
15% 10%
34%
34%
10% 6%
8%
6% 3%
5%
Cannot meet my required minimum payments on my debt
Jun 17
Investors
18%
20%
0
Owner occupiers
42%
Dec 17
Jun 18
Dec 18 Source: ME Household Financial Comfort Report, December 2018
Increase a lot
Increase a little
Remain around the same
Decrease a little
3%
Decrease a lot
3%
Unsure
Source: ME Household Financial Comfort Report, December 2018
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UPFRONT
HEAD TO HEAD
How can banks and brokers work better together? Putting the best interests of customers first is the key to a good working relationship
Graeme Holm
Richard Khuong
Director Infinity Group Australia
Director, finance strategist and mortgage adviser Simple Easy Finance
“Today the most important thing for both banks and brokers to acknowledge and implement is that clients should always come first and profits last. Meeting the best interests of clients is how banks and brokers can operate together within the financial services sector. Both should provide direct and indirect service offerings and competitive opportunities to consumers. “If we can all work towards a clientcentric business model that provides needs-based solutions to consumers, then both banks and brokers can co-exist while competing to provide exceptional consumer outcomes.”
“I already have a good relationship with most of the lenders I work with as they understand the importance of brokers to their business. The issue comes from the ones that have their own agendas. “If the lender can truly show us how much they value customers and the broker community, there wouldn’t be any issues. Why would a customer want to change a lender if it provided a fair rate and service? Why would a broker want to move his or her client from that lender if he or she was remunerated appropriately and the client was treated well? If those two can be answered by the lender, then I know we can work well together.”
Louisa Sanghera Principal broker Zippy Financial
“The key point is that we are all working for the consumer, and we should all be focusing on this and the client’s needs. We need to be on the same team, supporting and not pitting against each other. Banks and brokers need to work closely together to ensure they are achieving the best outcomes for consumers. However, we all need to be playing on a level field. Bankers and brokers should be made to uphold the same standards, policies and processes; to ask the same questions, provide the same documents and get the same outcomes.”
ARE CUSTOMER-OWNED BANKS TAKING OVER? Under the dark shadow that the royal commission’s interim report has cast over the entire banking sector there’s a small ray of light: customer-owned banks. While traditional banks faced some degree of public discontent in 2018, customer-owned banks enjoyed profile and book growth as people looked for better financing alternatives. According to APRA’s September 2018 quarterly banking figures, total assets of customer-owned banks rose to almost $113bn. Apart from that, the sector’s deposit and housing loan growth surpassed that of major banks on both an annual and quarterly basis.
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UPFRONT
NEWS ANALYSIS
RBA holds as bank rates ‘creep’ Despite the fact that the Reserve Bank has held rates for over two years, banks have been increasing their variable rates as they face heightened funding costs. But is there an ulterior motive for these rate rises?
THE RBA had always said its next move would likely be a rate increase, but Governor Philip Lowe has now altered the central bank’s position to a more neutral stance, suggesting it could go either way. While Australia’s cash rate has now been at 1.50% since August 2016, some commen tators are saying there are more and more
Speaking at the National Press Club in February, Lowe addressed monetary policy, saying “Looking forward, there are scenarios where the next move in the cash rate is up, and other scenarios where it is down. Over the past year, the next-move-is-up scenarios were more likely than the next-move-isdown scenarios. Today, the probabilities
“If something goes wrong within the world economics, down is the most likely thing [for rates]. If inflation goes down and stays there, up is more likely” Steve Mickenbecker, Canstar reasons to make a move. But the RBA has kept the rate on hold as it waits until inflation is within its target range. But even if inflation gets there, it does not mean the RBA will move the rate, according to Canstar’s group executive of financial services, Steve Mickenbecker. “They also want to see some wage inflation to give people a buffer; it’s been a long time since we have had wages growing, and that’s necessary to give borrowers a buffer in the event of payments going up,” he says.
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appear to be more evenly balanced.” Explaining what the RBA would look for before deciding which way to move rates, Mickenbecker says: “Their prime objective is to get inflation in that target range. They have to see a problem globally with growth before they reduce rates. Either way, whether it’s up or down they’re not going to move until they’ve got some clear evidence. If something goes wrong within the world economics, down is the most likely thing [for rates]. If inflation goes down and stays there, up is more likely.”
The RBA’s monthly cash rate has always been a benchmark for standard variable rates, and the banks traditionally would only have moved their rates to coincide with it. However, bank rates have been moving considerably over the last several months without any movement from the central bank. Bank of Queensland was the first to hike rates in 2019, by up to 18 basis points. Since then, Virgin Money, ING, ME and Macquarie have also increased rates. Mickenbecker says, “What we’re seeing is the household rates are going up in response to movements in the US. So the borrowing rates the banks can get have gone up. That means they have put through rate increases of 15, 16 basis points. “Something else going on is that the banks over the last few months have reduced some rates on basic products and some rates on short-term fixed rates because they don’t have to pass that through to existing borrowers. It’s only available to new borrowers. “We have seen variable rates going up to cover the cost of funding, and that powers through to existing borrowers.” In the ACCC’s Residential Mortgage Price Inquiry last year, the commission found that new borrowers were paying less than existing borrowers. It said, “The average interest rates
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RATE DIFFERENCES: NEW VS EXISTING v VARIABLE RATE LOANS The difference in average interest rates between the ACCC’s Inquiry Banks for existing and new standard variable rate residential mortgages: 30 June 2017 and 30 June 2018
Investor
Owner-occupier
30 JUNE 2017 Loan category
Existing
New
Difference
Principal and interest repayments
4.25%
3.98%
0.27bps
Interest-only repayments
4.50%
4.27%
0.23bps
Principal and interest repayments
4.83%
4.55%
0.28bps
Interest-only repayments
5.01%
4.78%
0.23bps
offer new customers 6.9%. Over time these discounts became greater and greater for new business,” McFadden says. In other words, to boost business banks would offer discounted home loan rates to new customers, while keeping the old customers paying more. They then began increasing rates out of tune with the RBA.
“A bank is never going to ring you up and offer you a discount, whereas with us that’s what we do” Rob McFadden, Hypothèque These changes for existing but not new borrowers are what one broker calls “rate creeps”, and he says the banks are manipulating the market. Rob McFadden is the owner of mortgage brokers Hypothèque and is the man behind the recent petition in support of brokers. He says it was in the 1990s that banks became more “dollar conscious” and intro duced multiple new home loan products. The rate creeps started when banks began offering discounts for new customers. “So, let’s say you’ve got a thousand customers on a 7% rate, then they decide to
“What the banks have been doing is citing funding costs, and when the RBA drops the rate by 25 basis points the banks say, ‘We’re only going to pass on 15’. But then they’ll up the ante for the new customers and pass on the full 25. And that’s a very clever way of manipulating the market,” McFadden says. “And by the same token, when the RBA puts up the rate, again the banks will bring out ‘funding costs’ claims and put the rate up 35 or 38 points. This has been repeating over time, and so the standard variable rate has become higher and higher in relation to the Reserve Bank cash rate.”
Investor
paid by new borrowers on variable rate residential mortgages with the Inquiry Banks have been less than those paid by existing borrowers since at least June 2015. This is due to larger discounts being offered to new borrowers compared to borrowers who took out their residential mortgages 12 months or more prior.”
Owner-occupier
30 JUNE 2018 Loan category
Existing
New
Difference
Principal and interest repayments
4.13%
3.89%
0.24bps
Interest-only repayments
4.62%
4.49%
0.13bps
Principal and interest repayments
4.73%
4.41%
0.32bps
Interest-only repayments
5.10%
4.87%
0.23bps
Source: ACCC analysis of data supplied by the Inquiry Banks
McFadden says these rate creeps are why brokers deserve their trail commissions, as they continually monitor these rate changes and ensure their customers are on the best deal possible. He adds, “A bank is never going to ring you up and offer you a discount, whereas with us that’s what we do – we continually review and contact our customers to try to negotiate a better deal. The trailing commission was designed to help us maintain that ongoing relationship with the client. “If you have two customers with the same original loan – one through a bank and one through a broker – chances are the one with the broker five years down the track will be paying less, because they’ve had someone renegotiating for them.”
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UPFRONT
OPINION
GOT AN OPINION THAT COUNTS? Email rebecca.pike@keymedia.com
Adapting to a changing broker market The royal commission report has led to a lot of uncertainty and wavering consumer sentiment, but the broker industry has the opportunity to prove itself again, writes RateSetter’s Mark Woolnough IT’S NO secret that, as we entered 2019, the finance sector was bracing itself for a year of unprecedented change. Uncertainty caused by the broker remuneration debate highlighted by the Productivity Commission and banking royal commission; an impending federal election; housing market volatility, and tightening lending standards saw many brokers wondering what 2019 would bring. Add to this wavering consumer sentiment and an ambiguous economic outlook and it’s no wonder brokers are concerned about their futures. The reality is, there’s always uncertainty. But the good news is that, in the wake of the royal commission report, the way forward for brokers is becoming clearer now that the recommendations are known. As long as brokers keep innovating, putting customers first and moving forward, the industry will prove itself again, just as it did post-GFC.
Broker community collaboration In the face of this uncertainty, the broker proposition has never been more important. The expectation of customers is that their best interests will always be put first. Many clearly value the service they currently receive from brokers – 59.1% of all residential home loans in the September 2018 quarter were settled by brokers, according to the latest research from comparator, a CoreLogic business. It’s imperative this customer focus isn’t jeopardised or harmed in any way as a result of
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Commissioner Hayne’s recommendations. Looking ahead, educating consumers on the value brokers can provide and the wide range of services they can offer is one step brokers can take to immediately build and execute a strategy to future-proof their businesses.
connect with consumers. Young brokers are also diversifying their offering so they can provide more value to both their existing and future customers. That being said, more experienced brokers may find that a large existing customer base and strong referral networks provide an equally strong base from which to offer customers a wide range of credit products outside the traditional residential and investment services. While this time of change will prompt some brokers to leave the industry, those who remain customer focused will prosper in 2019 as they respond and adapt to the changing landscape.
Bringing brokers into the fintech fold While the fintech market can be viewed as a threat, it offers great opportunities for those brokers willing to branch out to cater to a wider range of their customers’ financial needs. At RateSetter, we are committed to building our partnerships in the broker channel. As Australia’s leading peer-to-peer (P2P) lender, we’ve already helped over 5,000 accredited brokers improve their customers’ financial
There’s always uncertainty. But the good news is that, in the wake of the royal commission report, the way forward for brokers is becoming clearer Adapting to the new borrower world Waiting for potential new regulations to be put in place, or relying on lenders to adjust commission models to compensate for the recommendation to abolish trail, will only encourage more uncertainty. Rather, brokers need to take control and proactively set clear business goals to drive their revenue themselves. Key to this will be diversification. Broadening the broker offering will be a primary strategic pillar to provide more value to customers and promote sustainable business growth. The younger broker generation may find this easier, as they rely less on strong market forces to drive their business growth. The MFAA Young Professionals Report found that the industry is attracting a generation of young and enthusiastic brokers who recognise the value of spending more time and effort on lead generation and marketing to
wellbeing. RateSetter offers a better-value alternative to traditional lenders for unsecured personal loans, car loans and renewable energy loans. We align with the core values of the broking industry: being customer-centric and providing a better alternative for consumers. For brokers ready to adapt, it’s an exciting time to broaden and deepen their relationship with borrowers as their financial coaches, mentors or advisers, and in doing so to provide better outcomes for customers and their own businesses well into the future.
Mark Woolnough is head of third party distribution at RateSetter. He joined RateSetter in 2018 after nearly two decades of experience with brokers and a further 10 years in banking, having held roles at both ING and ANZ.
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PEOPLE
BIG INTERVIEW
THE DEVIL’S IN THE DETAIL The new head of third party at ING, Glenn Gibson, discusses the ‘uncertainty of the unknown’ causing nervousness in the industry. What words of advice can he offer to brokers who are feeling the strain?
AFTER MORE than 30 years in the industry, it might be said Glenn Gibson knows a thing or two about financial services, particularly when it comes to coping with changes, like those facing mortgage brokers now. ING’s new head of third party distribution and direct mortgages saw the birth of the broker channel, interest rates above 17%, and the impact on banking and businesses of the GFC. Gibson joined ING in November 2018 after a seven-month stint at Yellow Brick Road as general manager. Before that, he was at AMP Bank, where he helped its broker, direct and retention channels deliver significant year-on-year growth and market share. But even after 34 years in financial services, 24 of which were in the third party space, Gibson says he is not immune to challenges and times of uncertainty. Throwing yet more change into the industry’s timeline, the royal commission
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final report’s recommendations to remove broker commissions have unnerved many. Just like when licensing came in for brokers, Gibson says, it’s the uncertainty of the unknown that causes nervousness.
“People get very nervous and uncomfortable when they can’t control something and they don’t know what’s going to happen,” he says. “That can be anything from their business to the birth of a child. You don’t know
“There are things that always happen to your business, but if you’re controlling what you can control it seems a lot less to deal with” While we do know both the Liberal and Labor parties’ responses to the recommendations, nothing is set in stone until after the election in May, or until legislation begins to go through. This creates more uncertainty around the future of mortgage brokers, adding to the industry’s stress and concern. Gibson has some words of advice: the “devil’s in the detail”, he says, and until we understand exactly what’s going on, people should try to control what they do know.
what you don’t know. So, focus on what you can control. “The things you can control are your business, your activity, your family, your lifestyle, the things you like and the things you do know. So I would recommend people focusing on things in their life that they like doing. And that may be, I don’t know, retail therapy. “I’ve always been a runner as well, so sometimes it’s doing exercise; it’s getting fresh ideas then getting back and being
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PROFILE Name: Glenn Gibson Company: ING Title: Head of third party distribution and direct mortgages Years in the industry: 34 in financial services, 24 in third party Career highlight: “Taking AMP Bank distribution channels out of the GFC to set eight straight years of record volumes” Career lowlight: “The impact the GFC had across the Australian mortgage industry. Seeing so many friends and colleagues impacted by rapid business consolidations and closures”
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PEOPLE
BIG INTERVIEW
recharged and saying, ‘OK, how do I control the situation’? “There are things that always happen to your business, but if you’re controlling what you can control it seems a lot less to deal with.” Giving examples of how he has dealt with uncertainty himself, Gibson highlights the difficulties of the GFC and what his worries for his business were.
He adds, “You take on other people’s concerns. I look at myself: I’ve got roughly 130 staff, and when the royal commission report came out 130 staff instantly said, ‘What does that mean for us?’, ‘What does that mean for me?’ “Everybody personalises it. You’ve got to allay their fears, but you also automatically take it on yourself. As a manager you are
“I’ve got roughly 130 staff, and when the royal commission report came out 130 staff instantly said, ‘What does that mean for us?’” “Through the GFC there were a number of businesses, long-standing businesses, that were impacted,” he says. “There was downsizing; some were closing. I was involved in that situation where we had to change our business. You automatically worry about your staff, and brokers will be doing the same thing – worrying about their staff, what’s the impact on their family?” Gibson says worrying about staff is where a lot of the stress comes from, and he knows this from personal experience. “My daughter is a broker, and my wife works in the finance industry as self-employed, so she owns a franchise in the financial services space and they have staff as well.”
always aware of the people around you and the people that have supported you. It can be daunting in times of change, so it’s important to stay focused and level-headed.” What are Gibson’s tips for brokers who are managing a team of worried staff? “Being able to talk to the staff, involve the staff in what’s actually happening and involve them in the process,” he says. “But what you need to do is get busier. Think about the extra things you could be doing for you and your staff. “The markets have slowed down a little bit; everybody’s worried about what may happen. This is the perfect time to start upskilling your staff, getting your staff
focused on new things they could be doing. The busier you are the less you’re worried about external factors.” But Gibson also says it’s important for brokers’ mental health that they pull themselves away to have a bit more clarity of thought about their own goals. “It comes back to that control,” he says. “It comes back to, if I feel I’m out of control, my stress levels go up. If I know what I’m doing tomorrow and I know what I’m going to do next week and I know what I’m going to do for the next month, my stress levels are reduced dramatically.” Demonstrating ING’s backing of the broker channel, Gibson says he sent out around 15,000 voicemails to brokers after the report came out, reiterating the bank’s support. Asked if the bank is going to wait and see what the future holds before making any decisions, Gibson says: “You die as a business if you wait and see. Whether you’re a selfemployed person or a corporate, you have a goal, you go after that. For ING we have growth plans, and those growth plans include growth into the broker channel in 2019 and beyond. “I think the one thing we’ve really got to concentrate on is that there’s a customer at the end of all this. The customers haven’t gone away – the customers are not going to go away.”
ING IN NUMBERS
Launched in 1999
More than 1.6 million active customers*
$42bn in deposits*
$56bn in loans*
More than 1,500 employees
No. 1 bank for most satisfied home loan customers+
*Data captured September 2018; + Roy Morgan bank satisfaction survey
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FEATURES
NON-MAJOR SUCCESS
Non-major shines through Bankwest proves its weight by leapfrogging into second place from sixth in this year’s Brokers on Banks survey. Head of third party banking Ian Rakhit says it’s all about listening to brokers
ONE OF the big achievements in this year’s Brokers on Banks survey was the appearance of a non-major in the top three as Bankwest jumped from sixth place last year to second. It’s the first time in Brokers on Banks history that a non-major has appeared in the top three. Bankwest was voted the best bank for turnaround times as well as interest rates; it also placed in every other category. Ian Rakhit, Bankwest’s head of third party banking, says the bank was delighted to be recognised by brokers for its dedication to the industry. “Where we really aim to differentiate is in providing brokers with the ability to grow their own businesses by providing an outstanding customer experience,” he says. “We’re in an ongoing dialogue with our broker network and we’ll continue to listen to feedback to ensure we’re designing products and services that meet broker needs and customer and community expectations.” Brokers who took part in the survey were asked to rank banks in nine categories. They were then asked to rank the importance of those nine categories. In a year that has seen brokers and borrowers wait even longer to find out about their loan applications, as well as brokers
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WHERE BANKWEST PLACED
• Turnaround times • Interest rates • Communications, training and development • BDM support • Online platforms and services • Commission structure • Credit policy • Product diversification opportunities • Product range having to do more work to get there, it was no surprise that turnaround times was voted the most important category. For Bankwest to take that crown is a big win when it’s competing against other major
players with potentially more resources. “We have a very well-established case ownership model, which I know is highly valued by brokers,” Rakhit says. “This means from day one the broker knows who is working with them on their deal and will support them all the way to settlement. We try to ensure every deal is assessed within 24 hours.” In November 2016 Bankwest introduced its Home Loan Tracker application, Rakhit adds. The web-based tool allows both brokers and customers to stay informed throughout their loan application process, not only from application to settlement but through to the borrower’s first repayment. In the survey MPA asked brokers whether there was a particular technological improvement that had contributed to the faster turnaround times. In response to this question, one broker who praised Bankwest’s broker portal said, “Excellent tool for monitoring both active and existing clients. Being able to review existing clients’ rate terms and balances at any time is a helpful tool in helping to manage the client.” Other brokers also praised the portal, saying it had improved significantly in the last
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WHERE BANKWEST PLACED Rank
1st
Category • Turnaround times • Interest rates
2nd
3rd
• Communications, training and development • BDM support • Online platforms and services • Commission structure • Credit policy • Product diversification • Product range
“Bankwest is very proud to listen and respond to broker feedback, and over the last two years we’ve prioritised investment in our digital and broker offering” Ian Rakhit, Bankwest 12 months, with multiple brokers highlighting the broker chat service in particular. Rakhit says, “Bankwest is very proud to listen and respond to broker feedback, and over the last two years we’ve prioritised investment in our digital and broker offering
in line with our vision to deliver amazing customer experiences that matter. “Brokers’ needs, and the needs and expectations of our customers and the broader community, are changing rapidly. As a result, we’re evolving and improving the
digital services and products we offer, and we will continue to listen and respond to broker and industry feedback.” Bankwest also came very close to taking the top spot for BDM support, instead coming in second place. BDM support was voted by brokers as the second most important category. While the digital side of the business is important to help brokers improve their service, Bankwest also understands that third party banking is about relationships and trust, Rakhit says. “And that’s something I’m very proud of.” He adds, “I will continue to build the capabilities of our team of business development managers. It’s also very gratifying to see the quality of the people who are approaching us with a view to working with us because they see how actively we’re supporting brokering in Australia.” After continued credit tightening across all banks and a difficult housing market with buyers pulling back, brokers are preparing for another challenging year ahead, not to mention the changes to broker pay looming next year. But Rakhit says the non-major will continue to provide for brokers, hoping to make processes even easier. “At Bankwest we’re focused on delivering a world-class suite of digital products and services for our brokers and our retail customers,” he says. “We’ll continue to focus on the areas brokers tell us they value and keep listening closely to them to ensure we’re adapting to their changing needs. “As well as making ongoing iterative improvements to the usability of the broker portal, we’ll keep trialling and launching exciting new enhancements to better support brokers in meeting customer needs. It really is a case of watch this space.” To find out how the other banks fared in this year’s MPA Brokers on Banks survey, turn to the following page.
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SPECIAL REPORT
BROKERS ON BANKS
BROKERS ON BANKS
Brokers’ views of banks took another slide this year, and perhaps unsurprisingly given the heated public debates that have taken place regarding both their roles. But despite an overall lowering of the mood, there remain avenues for a resuscitation of brokers’ vital and necessary relationship with banks
THE RESULTS of the 2019 Brokers on Banks survey indicate the continuation of a development noted last year – namely, that banks are falling in the estimation of brokers surveyed by MPA. Nothing has changed in the way brokers are assessing banks – the four criteria ranked as most important were the same as in 2018: turnaround times, BDM support, credit policy and interest rates. In 2017, the overall winner (Westpac) had a final score of 3.72. Last year, the winner (ANZ) had a much lower final score of 2.76. The dropoff continued this year with the winning bank achieving a score of 2.54. This score would have placed them third in last year’s rankings. There were a few dramatic developments as one of the majors (and a previous overall
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winner) dropped from second place last year to fifth this year. On the other hand, a nonmajor leapfrogged its opponents from a finish of sixth in 2018 to an impressive second place in 2019. As many of the responses to our survey indicate, the banks that were most preferred usually excelled in the category of turnaround times, or had made significant improvements to facilities that eased interactions between broker and lender. The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry brought to the fore a lot of friction between brokers and banks. On top of the recent ASIC and Productivity Commission reports, this is
likely what accounts for brokers’ lower estimation of banks in general. Notably, the top two finishers this year achieved a top three ranking in every one of the nine criteria by which they were assessed. Their consistency was reflected in their triumph. Although relations between bankers and brokers may seem sour at the moment, brokers’ responses consistently emphasised the paramount importance of turnaround times, BDM support, and measures taken by banks to foster good relationships. If banks can go some way to alleviating the legitimate grievances brokers have developed over the past year, we may in future see a return to higher final ratings for the banks.
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OUR TYPICAL RESPONDENT
Writes $20m–$40m worth of mortgages a year
Aged between 46 and 55
Has been a broker for 3 to 5 years
Is most likely to work in NSW or Vic
WHAT DO BROKERS WANT? 1 = not important; 5 = very important 4.74
Turnaround times BDM support
4.69
Credit policy
4.67
Interest rates
4.39
Product range
3.96
Online platform and services
3.91
Communications, training and development
3.87
Commission structure Product diversification opportunities
3.63 3.47
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SPECIAL REPORT
BROKERS ON BANKS
PRODUCTS AND PRICING This past year saw a tightening of the regulatory burden facing banks and brokers. Broker dissatisfaction with the range of products and pricing offered by banks also spiked sharply. While two of the majors retained their top three positions from last year, Bankwest leapt onto the podium across all criteria DO YOU BELIEVE CHANNEL CONFLICT EXISTS?
15%
34% 2018
AT THE start of this year, APRA’s benchmark
APRA announced that it would remove the cap from 1 January this year. It also removed a 10% annual cap on investor housing credit growth that had been introduced in late 2014. The more restrictive lending environment cultivated in previous years by APRA and ASIC was accompanied by a series of out-ofcycle rate rises by banks, which cited funding pressures as justification, while the RBA kept
for interest-only loans was lifted after the regulator said it was satisfied that lenders had improved their lending standards and taken measures to reduce higher-risk lending. The benchmark, which was introduced in March 2017, restricted banks’ new interestonly loans to 30% of new residential mortgage lending. However, in December
HIGHLIGHTS: PRODUCTS AND PRICING
51%
Interest rates
33% 13%
Product range
Product diversification opportunities
Credit policy
2019
2018
2019
2018
2019
2018
2019
2018
1st
Bankwest
Westpac
ANZ
ANZ
CBA
ANZ
ANZ
ANZ
2nd
ING
St. George
CBA
CBA
ANZ
CBA
CBA
Westpac
3rd
ANZ
ANZ
Bankwest
Westpac
Bankwest
Westpac
Bankwest
CBA
2019 53%
Not a problem Minor problem Major problem
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the national cash rate at the same level (1.50%) since August 2016. Brokers have not welcomed such bank-initiated rate hikes. The effect of relaxing these regulations – along with the RBA’s February announcement that the cash rate would hold steady at 1.50% and not rise, as some had feared – doesn’t appear to have quelled many banks’ appetites for still higher rates. In the first two months of 2019, 14 lenders increased their variable home loan rates. On the other hand, during the same period eight lenders made cuts. Brokers took to the survey to comment on interest-only loans, with many saying the differences in interest rates between IO and principal and interest loans were just too high. “Most of my clients are on P&I. I will only go IO for investment clients if it is in their best interest,” said one broker from Casuarina. A lot of brokers also said there was no single bank with the best IO rates because of the constantly changing policies and rates. “[It] varies week to week depending on whether they want to grow or slow the IO caps,” said a broker from Seville Grove. While the overall balance appears to be tilting towards continuing rate hikes by the banks across products, one conspicuous exception to the trend is Bankwest, which announced in January that it would cut interest rates for borrowers with higher deposits. This may come as little surprise to those brokers we surveyed for this report, whose votes took Bankwest to the top of the pile – it came in first in the category of interest rates. This marks a return to the podium for Bankwest in this category, as the lender placed outside the top three last year after being ranked third in MPA’s 2017 survey. One broker from Freshwater said, “Bankwest have obviously invested a lot of
HAVE PRODUCT RANGES AND PRICING IMPROVED OR WORSENED OVER THE LAST YEAR?
51%
Improved Worsened
2017
2018
49%
money into the end-to-end application process right through to settlement and beyond. Seamless process.” ANZ held steady on interest rate measures, ranking third for the second year in a row. ING recovered in this category, placing second this year after slipping from a first place finish in 2017 down to eighth in 2018. Last year’s top ranker, Westpac, slipped
53%
68%
2019
32%
47%
year, as against 47% who thought they’d improved. This is a dramatic change from last year, when 68% of brokers registered an improvement, versus only 32% claiming deterioration. Furthermore, the previous three annual surveys registered a majority thinking on balance that the situation had improved. While ANZ and CBA largely maintained their strong showings from last year in products
“Bankwest have obviously invested a lot of money into the end-to-end application process right through to settlement and beyond. Seamless process” Survey respondent down to equal fifth this year, while 2018 interest rate runner-up St. George fell to seventh place. These rankings come, however, against a backdrop of marked dissatisfaction among brokers with the prices and range of products offered by the banks: 53% of brokers said they believed both had worsened over the previous
and pricing, the striking development was that Westpac and Bankwest traded places this year. Having made top three in all four criteria in 2018, Westpac failed to make a top three spot in any of the four criteria this year. After no top three finishes last year, in 2019 Bankwest is a podium finisher in all four criteria.
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SPECIAL REPORT
BROKERS ON BANKS
INCENTIVISING BROKERS Broker remuneration structures have been in the spotlight over the past year, and things seem to only be heating up further since the release of the royal commission’s final report recommending the wholesale abolition of commissions in favour of a flat fee for service WITH ASIC, the Productivity Commission and the royal commission all directing their scrutiny at remuneration structures over the last year, it’s clear that many brokers resent what is perceived to be unfair treatment. In late 2017, the Combined Industry Forum proposed what it saw as positive changes to the remuneration structure for mortgage brokers – with the stated intention of reducing conflicts of interest and bettering customer outcomes. The CIF model proposed that remuneration be based on funds drawn down and
utilised by the borrower, such that upfront commissions would be paid dependent on the facility limit drawn down, and the amount drawn down net of offset account balances (if applicable). The intention was to reduce incentives for brokers to have clients take out larger loans than they could afford because they could park a substantial amount in an offset account. Bankwest was the first to adopt such a commission structure in mid-2018, but since then the four majors have followed suit.
2019 HIGHLIGHTS: INCENTIVISING BROKERS
Commission structure
Communications, training and development
1st
ANZ –
ANZ –
2nd
NAB
3rd
Bankwest
Bankwest CBA – Key:
22
Went up a position
Went down a position
— Stayed the same
Brokers responded to the survey with mixed views of the CIF’s recommendations, although it would be fair to say that it is a preferred model over the one the industry is facing now. “This is going to be impossible for us to monitor, and we cannot trust the banks to pay us when funds are eventually drawn. This is the worst decision in my 14 years as a broker that the banks have implemented,” said one broker from Beaumaris. However, a Sydney broker said, “It’s a fair outcome and will stop brokers from writing loans for amounts the customer will not use.” A broker from Darwin raised issues regarding the practicality of the CIF’s reforms: “Perplexed here – I have a lot of wealthy clients who completely offset their lending, which means I wouldn’t be paid unless I charged an upfront for introducing the business to the bank, which is something we might have to explore for the future.” Despite the passionate comments, out of the nine criteria on which brokers were asked to rate the banks, commission structure was seen as second-least important to respondents. This may reflect an impression in the broker community that there is increasingly little to distinguish between the banks when it comes to commission structures. Looking ahead this year, the major story continues to be the fallout from the royal
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commission’s recommendation that the current remuneration structure should be completely abolished. Commissioner Hayne expressed the view that a flat fee paid to the broker by the borrower should replace the current system of commissions paid by the banks. The final report outlined the transition it proposed: “The borrower, not the lender, should pay the mortgage broker a fee for acting in connection with home lending. Changes in brokers’ remuneration should be made over a period of two or three years, by first prohibiting lenders from paying trail commission to mortgage brokers in respect of new loans, then prohibiting lenders from paying other commissions to mortgage brokers.” The broker community has expressed outrage over the proposals, indicating that such changes would cripple their businesses, empower the big banks and rob borrowers of their best chance of securing a competitively priced loan. Particular ire was reserved for CBA and its CEO Matt Comyn, who in the final round of the commission’s public hearings endorsed the switch to a flat fee for service. Compounding broker frustration was Comyn’s additional assertion to the commission that brokers provided almost no additional services to clients after initial completion of the loan, and that this justified the abolition of trailing commissions paid to brokers. This could be why CBA was pushed out of its 2018 position of third place for commission structure. Research conducted by HashChing found that 57% of brokers would refuse to use CBA in future if the fee-for-service model came into effect.
SHOULD COMMISSIONS BE BASED ON FACILITY DRAWDOWN NET OF OFFSET? Answers
Yes
39%
No
61%
What you said
“We brokers can focus on customers’ needs, not chasing after dollar figures” “Only fair that brokers get paid on money used, as the bank only makes money on the drawdown” “Happy to get paid for what is used” “As that is what the bank is getting paid interest on, it makes 100% sense” “This will avoid brokers drawing excess funds to increase their upfronts” “Commissions should only be paid on the amount that the customer actually requires, with some exceptions such as construction and/or funds to be used for a specific purpose in the future” “Commission paid in this way removes all potential conflict, with remunerations being based on the exact amount of funds required by the clients”
“Not everyone wishes to use all of the savings towards their purchase; some clients would like to have the cash in the safe for a safety net, or perhaps they might have other purposes for the funds. And it’s not fair that we as mortgage brokers get penalised” “The client has been approved to service the loan limit, and the bank has to allocate that amount against their prudential limits. As such, why are we brokers penalised?” “Commission should be paid on the entire loan value as it always has. And if not then the difference in commission should be paid to the customer – not given back to the banks as more profit” “Too hard to explain to consumers; and out of our control” “Should be based on the total loan drawdown; sometimes clients may need the funds in a few weeks or a short period of time” “The work done by a broker is the same irrespective of the drawdown and offset”
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SPECIAL REPORT
BROKERS ON BANKS
TECHNOLOGY, TURNAROUND TIMES AND SERVICE Increased scrutiny of banks and brokers over the past year has added dramatically to the regulatory and paperwork burden, and some brokers are seeing little reward for a lot of extra work. Dissatisfaction with turnaround times is way up, and how banks respond will be a major concern this year IT’S NO surprise that turnaround times once again topped the list as the most important criterion in respondents’ evaluation of the banks. The intense public scrutiny of banks over the last year – not least the royal commission’s criticism of lax lending practices – has undoubtedly had a major impact on turnaround times.
The royal commission emphasised that banks and mortgage brokers were not assessing living expenses properly. The commission’s interim report stated that, while the major banks had taken steps to assess applicants’ incomes, “the evidence also showed that much more often than not none of them took any step to verify the applicant’s outgoings”.
2019 HIGHLIGHTS: TECHNOLOGY, TURNAROUND TIMES AND SERVICE
Turnaround times
BDM support
Online platforms and services
ANZ –
CBA –
1st
Bankwest
2nd
NAB
Bankwest
Bankwest
3rd
ANZ
NAB
ANZ
Key:
24
Went up a position
Went down a position
— Stayed the same
Consequently, turnaround times have blown out as brokers and banks conduct more checks. A frequent complaint from brokers is that their workloads have doubled with all the extra reviews and paperwork they have to undertake, while simultaneously their applications have become more likely to be declined. In this year’s survey, 52% of brokers said turnaround times had either worsened or worsened considerably. With 19% claiming no difference from last year, that left a paltry 29% on the ‘improved’ side of the ledger. This is a dramatic drop from last year, when our survey showed that 45% saw an improvement, and only 26% saw a deterioration. Not only that but the percentage of those citing an improvement was substantially lower than it was in the previous three years’ surveys. Brokers this year awarded Bankwest the highest ranking for turnaround times, followed by NAB and ANZ. The preference among brokers for these three banks was also reflected in their ratings for BDM support – in which ANZ came first, with Bankwest and NAB following behind. The similarity of results in these two categories reflects the reality that effective BDM support is a major contributor to
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HAVE TURNAROUND TIMES IMPROVED OR WORSENED OVER THE LAST YEAR?
IS TECHNOLOGY IMPROVING TURNAROUND TIMES?
No Improved 2017 No difference
37%
2018
45%
2019 23%
29%
29%
19%
26%
52%
Worsened 40%
“Each and every bank goes up and down with their turnaround times despite technologies in place” ”Uploading of documents to ApplyOnline means more work at the broker end and has not translated to faster turnaround times. Constantly having to follow up non-receipt of documents” ”The application process online has doubled in recent years and takes around three times longer than it would if you hand-wrote the application and faxed it through to the lender”
Yes quicker turnaround times. Recognising this, brokers rated BDM support as the second most important of the nine criteria when evaluating banks. Our survey asked whether any particular technological innovations by banks had helped to improve turnaround times. Many brokers commented enthusiastically on Bankwest Broker’s online portal and chat facilities. One broker said: “Bankwest Broker Online Chat is great – very user-friendly. Being able to access clients’ accounts to establish rates and remaining loan terms for
annual reviews is excellent, but not available with enough banks yet.” Brokers’ comments indicated that the quick and easy access to important client records facilitated more efficient communication between brokers and Bankwest, cutting down on turnaround times. A number of brokers also made mention of the fact that they had shifted more business toward Bankwest, ANZ and NAB in the past 12 months on account of the superior BDM support and turnaround times offered by these banks.
“ApplyOnline continues to be improved, with most main banks taking advantage of the improvement” “Delivery of loan documents electronically allows process to settlement to be so much quicker; often documents are available same day or day after approval” “Yes, more transparency on communications and processes”
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SPECIAL REPORT
BROKERS ON BANKS
WHAT YOU’RE SAYING Do brokers actually get clients more options and better deals? Brokers weigh in with their perspectives MORTGAGE BROKERS have been getting a lot of fire over the past year. Since late 2017, ASIC, the Productivity Commission and the royal commission have all released reports questioning the value brokers add to consumers seeking a loan. The Productivity Commission and the royal commission both advocated the abolition of trailing commissions, with Commissioner Hayne claiming brokers were getting “money for nothing”. While our survey was conducted before the release of the commission’s final report and so doesn’t address the now-immediate concern of the wholesale remuneration structure, our respondents did provide us with useful insights into their role in facilitating consumer choice and getting better deals for their clients. That said, brokers’ responses to the proposed changes to remuneration were sharply critical.
PART OF AN ELITE CLUB? Lenders have agreed that elite broker clubs ‘should not entitle brokers to preferential customer discounts or to additional payments or commissions’, and that brokers must disclose their membership to customers. Would you want to be a part of an elite broker club under these conditions?
Yes 166
47% 53%
No 147
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The royal commission has also sparked further emotion in regard to channel conflict. The number of brokers who believe it is a major problem has grown over the last few surveys. This year’s increase could be down to the heads of the big banks who spoke at the royal commission hearings sometimes playing down the role of the broker. Respondents who believe there is channel conflict were very vocal about the exact banks they were thinking of, and mostly referred to the big four, their reasons being issues over
turnaround times and ease of accessing finance. Many said they had stopped using banks due to poor broker support, slow approval processes, their appearances during the royal commission, and reduced BDM support. This year there is an almost even split between brokers who do and don’t want to be part of an elite club. Last year the results were further apart, with 61% saying yes and 39% no. We have highlighted five responses to our Prize Question here. All five brokers will be sent a Home Mini for their answers.
PRIZE QUESTION: BROKERS ON LENDER CHOICE ASIC found that the average brokerage sent 80% of loans to four lenders. Is this true for your business? Please explain why/why not. “Yes, it is true. It all comes back to service levels, credit policy, and rates. We find the smaller lenders or non-majors are often restricted with their product offerings (policy and LVR and postcodes, etc.) and the larger lenders are able to do deals and are more competitive with each other. And also, at the end of the day, it is what is going to suit the customer’s needs and wants and objectives.”
Yes
Star comment “Yes, it’s true and for good reason. I always try to find the best deals for my clients. As an example, ING are consistently the best so I use them the most, but they do have higher servicing hurdles. If someone else comes up with better rates or a larger loan amount (if that’s required) then I’ll use them … It’s all about getting the best loan for my clients … I want my clients to be happy so they come back again and again and send me their friends and family. The reality is that the best four lenders don’t change that much. ASIC’s findings should not be seen as a bad thing – I know in my case they just reinforce that I’m doing the right thing.”
“This is not true for my business. We work with over a dozen lenders and we use them all as required – determined by our clients’ requirements and objectives. All lenders on our panel are there for a reason, either because they offer great rates, great products and/or service OR they fill a niche. Unfortunately, none of them offer all these things.”
No
“No, I have been advised by my aggregator that my figures show I am one of the most diverse brokers. I offer my clients the best four options for them – I do not care who the lender is.” “No. Every client’s circumstances are different, and a bank needs to be matched to the circumstances. There will be predominant lenders that suit a lot of options, but my business goes to a range of lenders, not just to four.”
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WHERE YOU STAND ON ELITE BROKER CLUBS “There is nothing wrong with being part of a club if it is based on recognition for hard work, strong business morals and ethics, and a focus on customer satisfaction and delivery. If you need to be part of a club to offer greater discounts, then … brokers should not deal with these parasitic lenders.” “These clubs should not exist. No matter what the metrics used, brokers who are part of these clubs obviously favour these lenders. I know for a fact that one of Australia’s most rewarded brokers sends literally 90% of loans to CBA. How this can be beneficial to his clients I have no idea…” “I have been part of these ‘broker clubs’ before and never received higher commission or better discounts. It was to do with a better turnaround time. I agree that like any industry you should receive better service if you are a bigger customer or support them more. [But] I agree that higher incentives and payments should not go on – I can see how this could influence a broker’s recommendation.” “I currently am Premium ANZ and Gold with St. George. I do disclose this with customers when discussing turnaround times, etc., and benefits to them; however, I always put forward a number of lenders and the customer decides – I do not favour one over another due to this.”
COMMISSIONS BASED ON FACILITY DRAWDOWN “We cannot control what a client does post-settlement. We deal with many small business owners who find offsets are a good place to park business funds to reduce interest costs. I refuse to believe that broker loans are higher than others – we listen to clients and set them up for the medium term rather than a simple transaction.” “Don’t get me started – with all the work we do and even more now they are robbing us blind and still think it’s okay to claw back commission up to two years. Let’s do the same to the banking executives who have failed not only brokers but brought the banking sector into disrepute – let’s claw back their bonuses. This is not sustainable. Watch this space – there will be an uprising.” “There were some brokers encouraging borrowers to go up to 80% and just offset the rest, which in theory is fine if there is a real purpose to those extra funds. However, I think it’s either this or we lose trail, for example. So I don’t mind these changes at all.”
EXPERIENCE WITH CHANNEL CONFLICT “Channel conflict only exists when branches actively try to break down the relationship with the broker by discrediting our loan structures, etc. A good relationship with your local branches is as critical as ever.” “Remember – we are dealing with people and people are intrinsically greedy. So you will meet people from time to time who don’t look long term and try to take some advantages. I haven’t seen any systematic issues.” “I believe it is a problem as branch staff have targets to meet so are always going to be conflicted. I believe it is a minor problem though, as I haven’t experienced it as yet.” “I believe it exists but it’s hard to know and monitor. We usually find out after the fact when a client has gone to a branch and done something themselves, at which point sometimes it’s too late to do anything. “We haven’t really experienced channel conflict in the last 12 months.
“As a mortgage broker we should be motivated by the best interest of the client rather than commission. For example, brokers could potentially recommend a client puts money into a savings account rather than an offset account, which creates a disincentive for the broker to do the right thing by the client.”
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SPECIAL REPORT
BROKERS ON BANKS
FINAL RESULTS Here we reveal the winners and losers in this year’s overall survey results. And the winners are…
BANKWEST
ANZ Position in 2018: 1st Position in 2017: 2nd ANZ proved once again that consistency breeds success, winning its second gold in a row to become 2019 Bank of the Year. The bank appeared in the top three in every category, including an impressive five out of nine first place finishes. In a tough year for banks and brokers, ANZ’s first place for BDM support – always a separating factor in the minds of brokers – likely helped its reputation greatly. The bank also improved on its individual score for commission structures, which is favourable in a year in which broker remuneration was often the subject of hostile scrutiny during public investigations and in the media. One area in which ANZ dropped
notably was turnaround times. Although the bank still secured third place in this category, its rating dropped from 2.98 in 2018 to 2.16 this year. Perhaps this is not so ominous a sign for ANZ after a year in which the regulatory burden was tightened and the public pressure immense to ensure double-thoroughness of every application, but as this is the most important category for our brokers, ANZ will be hoping to ensure it doesn’t slide any further in the year ahead. As one might expect, whether ANZ is able to again hold on to its first place category next year will depend on how the bank finesses its response to the royal commission – and whatever changes come in its wake. But it should be proud of another year on top in the hearts of brokers.
CBA Position in 2018: 3rd Position in 2017: 3rd CBA retained its bronze for the third year in a row. This may surprise some given that the bank has had a particularly fractious relationship with brokers over the past couple of years, with particular animus directed in this year’s survey at its treatment of brokers – such as its CEO’s criticisms of broker remuneration at the royal commission. Add to this the fact that CBA scored only sixth for turnaround times and BDM support and it seems the bank’s position was salvaged mainly by its strong showing in most other categories – finishing in the top three for five out of nine criteria. Still, there isn’t an aura of optimism surrounding CBA at the moment.
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Position in 2018: 6th Position in 2017: 5th Bankwest may well be the big story from this year’s competition. Last year, after a sixth place finish, we concluded with a tone of slight disappointment regarding the bank’s performance: “Bankwest remains stuck in middle of the pack. While last year it made a big leap forward to fifth place from eighth in 2016, it wasn’t able to stay ahead of NAB this time around.” Well, this year it left everyone in the pack behind bar one and rocketed to a top three finish in every one of the nine categories. It finished first in the category most dear to brokers’ hearts – turnaround times – as well as first in interest rates and second in BDM support. Time and again brokers made note of Bankwest’s Online Broker portal and chatrooms, noting the immense difference that accessibility to client information made to turnaround times. With the four majors cleaning up all the podium spots in the last two years, to have a non-major leapfrog into second is a testament to its dynamism in what’s been a hard year for the mortgage and banking industries.
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OVERALL RESULTS 4th
NAB
Position in 2018: 5th Position in 2017: 6th NAB had a solid year, again stepping one place up the ladder, as it did last year. The bank also took out a top three finish in three of the nine categories. This might not seem like anything special when compared with the top three banks until you consider that collectively the top three
5th
Bank
Overall score
ANZ
2.54
Bankwest
2.50
CBA
2.34
4th
NAB
2.27
5th
Westpac
2.19
6th
ING
2.02
7th
St. George Banking Group
1.94
8th
Macquarie
1.80
9th
AMP
1.51
10th
Suncorp
1.44
WESTPAC
Position in 2018: 2nd Position in 2017: 1st This year’s results will be gutting for Westpac after back-to-back wins in 2016–17 and a second place finish last year. What accounts for its precipitous slide this year?
6th
picked up 23 of the 27 top three finishes available. Importantly, NAB saw a strong improvement in BDM support (its score went from 2.55 to 2.71), placing third in that category. It also improved from 2.08 to 2.19 (and secured a second place finish) in turnaround times. So, to NAB’s credit, it managed to impress brokers where brokers most want to be impressed.
To generate the overall results, we took an average of the results for every category of service. This means every category had an equal impact on the final result. Flip through the previous pages to read more about which banks excelled where.
Essentially, its ratings dropped markedly in all four of brokers’ most important criteria, and it didn’t record a top three finish in any category. If Westpac wants to return to form next year, these are the areas it will need to work on.
ING
Position in 2018: 8th ING had a good year, all things considered, and jumped two spots on last year to finish in sixth place. Hearteningly for the bank, its overall rating improved dramatically, from
1.55 in 2018 to 2.02 this year. Last year, ING dropped to eighth place in interest rates after placing first in that category in 2017. It will be pleased to have recovered this year with a second place finish.
Note: Scores go from 1 (very bad) to 5 (very good)
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12/03/2019 10:35:58 AM
SPECIAL REPORT
BROKERS ON BANKS
ANOTHER YEAR AT THE TOP FOR ANZ Brokers praised ANZ’s BDM support, product diversification and training and development, leading the major bank to top the polls in five out of nine categories in this year’s Brokers on Banks survey
It’s been a difficult year for banks and other lenders. Why did brokers pick ANZ as their favourite bank for the second year in a row? It’s a privilege to win this award, and it’s a great acknowledgement of the great work our extended broker teams do on a daily basis. We are aware there are areas where we need to improve, including finding ways to be simpler and faster, which are especially critical across the entire home loan process. Rest assured we are listening and taking appropriate actions behind the scenes. While we acknowledge there is work to do, overall we are incredibly proud of our people and our culture. We are regularly told our BDMs are the most informed, responsive and accountable in market. We have a strong speak-up culture and prioritise continuous learning and development, which helps us to attract and retain the best and brightest talent. Our BDMs make this business what it is across the country, and everyone’s resilience and professionalism are essential ingredients to the success of this business.
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ANZ has played, and will continue to play, a very active role in the Combined Industry Forum because we recognise that coming together as an industry has never been more important. We have already implemented a number of CIF recommendations and are very proud of the leadership role our extended team has played across the industry in the past year. We aim to continue to earn the market’s trust by engaging thoughtfully when we introduce changes. We need to make sure we think carefully about the impact and consider the potential internal and external unintended consequences. ANZ’s highest score overall was for its BDM support. What are your BDMs doing to continue the bank’s support of the broker channel, and why is that important to the ANZ? Our entire BDM team continue to stand out from the crowd for the right reasons. We often hear that our BDMs are known for their specialist knowledge, but above all their responsiveness, ownership of customer deals
and, more specifically, how they collaborate across the bank to deliver the right customer outcomes. If I look across all the categories that we’ve been successful in, for the most part our success can be attributed to our extended BDM team. For example, our BDMs not only interact with brokers but also play a role in creating educational content and leading our training program. We invest time and resources to ensure that our people are supported, particularly in a period of intense change, so they are able to communicate with brokers clearly and consistently. ANZ also came top for its product range. Why is it important that brokers are recognising the options the bank offers their customers? For ANZ, and in particular when thinking about the overall broker experience, this points to the strength of our broader business, including our internal collaboration across residential and commercial.
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Our residential and commercial teams sit side by side across the country, which ensures each individual broker relationship is being managed as one, irrespective of product and customer need. Our home loan options have remained quite consistent over the years. With nearly 30-plus lenders on our brokers’ panel, this type of simplicity adds to the overall broker experience. That said, we always have room to improve, and we’re working hard on improving our customer focus across our products and packages. The bank came in at first place for its communications, training and development for its second year. What have you done to continue your success in this area, and why was it important? One of our goals has been to lead the market with data and insights and to drive positive change through education and training. Over the past 12 months we have partnered with aggregators to understand in greater detail our strengths and opportunities. We want to be transparent about our mutual data insights so we can ask ourselves: how can we drive better outcomes for our customers? In 2018, alongside our traditional webinar program, we trialled partnered podcasts with aggregators and, not surprisingly, found that we got the best response from broker-led content. We also understand the need for further in-depth training for brokers at different stages of their careers, which is why our face-to-face program offers training from New Entrant to Complex Loan Scenarios. For us, education is not just about our aggregators and brokers but also our own ANZ teams. We’ve been focused on building a balanced culture that considers the customer’s needs first and foremost.
BANKWEST Bankwest jumped from sixth place last year to second this year. At a time when brokers are struggling with longer turnaround times, what have you done to become top in that category and earn yourself a place in the top two? Bankwest: Bankwest has been a long-term supporter of brokers, who provide an essential service that helps meet the needs of customers right across Australia. So understandably we’re ecstatic that the hard work we’ve put into improving the experience brokers have with Bankwest has been recognised as making a difference to their day-to-day work. Over the last two years we’ve prioritised investment in our digital and broker offering in line with our vision to deliver amazing customer experiences that matter. We’ve designed our support structure so that each broker is supported by a BDM and BSM, and each deal has its own case owner processing the deal from start to finish, and we try to ensure every deal is assessed within 24 hours. In addition, the tools available in our Home Loan Portal allow brokers to monitor their deals, process AVMs and chat to our Mortgage Support Team members. We’re in a continual dialogue with our broker network and we’ll continue to listen to feedback to ensure we’re designing products and services that meet broker needs and customer and community expectations.
CBA What have you done to be so well recognised in the broker community for your online platform and services, and why is that important to CBA? CBA: A key pillar of Commonwealth Bank’s Home Buying strategy is to build a strong and sustainable third party channel. To do that, we’re continuing to invest in the channel and focus on improving our processes and platforms and enhancing the training and education of our people. Over the last 12 months, we simplified our tiered broker segmentation model, which enabled our team on the ground to have more conversations more regularly with our broker partners. We invested in the Broker Support Hub to give our brokers one number to call – meaning they can quickly obtain advice and answers when they need them. We also invested in our assessment teams, recruiting and training 60 new staff not only to provide our brokers with consistent service but also to provide them and their customers with an enhanced service offering. We’ll continue to invest in this channel and work towards becoming a simpler, better bank, to ensure the third party industry remains viable and vibrant.
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11/03/2019 1:45:28 PM
SPECIAL REPORT
BROKERS ON BANKS
BROKERS’ PICKS As well as rating each of the nine categories in the Brokers on Banks survey, brokers were asked about their favourite mortgage products provided by banks in the last 12 months. The following products gained the most votes ING Orange Advantage
Premium Home Loan Package
ING’s Orange Advantage home loan was picked as one of the best mortgage products across all the banks, coming out well above all the other ING products. Brokers made mention of its good fees, great turnaround times and fantastic client service. One broker who selected the product said, “Competitive rate with offset and the option to split the facility with a fixed rate. Online banking platform is user-friendly and the customer service both during the approval process and post-settlement is professional and efficient.” Another said it was an “excellent package that extends beyond the home loan itself”.
Commenting on a number of features of Bank Australia’s Premium Home Loan Package, brokers also put this one on the list of top mortgage products. One broker praised the product’s “great rate, great discounts”. For brokers who are not just selling products to those in the big cities, the product was also picked for being available for properties in rural and regional locations. Another broker, who had named one BDM in particular in their response, also said, “Great rate, great offset product, excellent support from BDM and credit team. Lovely people to deal with and turnaround times have been excellent.”
WESTPAC
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BANK AUSTRALIA
BANKWEST
Rocket Home Loans
Complete Home Loan Package
Westpac’s Rocket Loans are available in the Premier Advantage Package and came out well on top of the bank’s product range. The most common comment on this product was the good rates, but also the turnaround times were highly praised as well as the ease of setting up offset accounts. Brokers picked up on the overall simplicity, with no hidden costs and good lending policies. One broker said, “Flexibility with packaged benefits and a simple product to understand for both broker and borrower.” Another broker also mentioned the flexibility, saying, “Customers have full flexibility to operate their loan.”
Bankwest received the highest number of votes for its products in this section of the survey, and its Complete Home Loan Package was strides ahead in winning the top spot. With one broker simply calling it “the best”, it was also picked for its interest rates, flexibility and up-to-date features. One broker thought very highly of the bank, saying, “One of the best interest rates going around, with all the possible features. Also, great BDM support and turnaround time.” Other brokers pointed out the ability to go to a 98% loan-to-value ratio and to have multiple offset accounts.
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228963
Brokers pick
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11/03/2019 2:00:07 PM
SPECIAL REPORT
FINTECH ROUNDTABLE
THE FUTURE OF MAINSTREAM Fintech lenders discuss the opportunities they provide to brokers who are looking for alternative ways to help their clients – but they say they won’t be alternative for much longer
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ACCORDING TO research by Roy Morgan, the level of trust in Australia’s banks has fallen over the past two years as the public has reacted to the failings highlighted during the banking royal commission. For non-mainstream lenders, this is their time to shine and to work with brokers to ensure customers know about the alternatives on the market. One such group believe they will soon be known as ‘mainstream’, instead of by the buzzword used to refer to them at the moment: the ‘fintechs’. An amalgamation of finance and technology, fintechs do what the name suggests and offer a more technological way of accessing or using money, whether it be through the digital systems that work in the background or the apps used in the foreground by customers. Fintechs can be lenders providing loans for small businesses or homebuyers; they can
be the companies behind tap payment systems; they can help you invest or save money by simply using an app; or they can provide solutions when it comes to verifying a customer’s expenses. Regardless of the type of financial technology a fintech might produce, one thing remains consistent among them all: they are working to make customers’ finances easier and faster to manage. With lengthy turnaround times one of the key bugbears of brokers who put in hours of work for long assessment times and currently a higher rate of decline, fintechs are offering real solutions. Particularly in the SME space, where business owners are timepoor and need cash flow fast, brokers are turning to the fintechs to provide their customers with the best outcomes. In a recent report, one such fintech lender found that its lending to small businesses
helped maintain 52,500 full-time equivalent jobs and contributed $3.65bn to the Australian economy – and that is just the impact of one fintech. As the industry comes out of the royal commission and prepares to build up trust again, education on the alternatives is key. Fintechs hope to soon be part of the mainstream offerings, rather than singled out as ‘fintechs’, and this year could spark that change – because as one of the brokers participating in MPA’s recent Fintech Roundtable said, “when there’s adversity, there’s opportunity”. Representatives from leading fintechs Prospa, Moula and OnDeck discussed the adversity the industry is facing and the opportunities that could come out of that, as well as the challenges they face as individual lenders, at the roundtable event in February. Read on to find out more.
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SPECIAL REPORT
FINTECH ROUNDTABLE
THE PANELLISTS BROKERS
FINTECHS
Matt Bauld GM, sales and business development, Prospa
Aris Allegos Co-founder and CEO, Moula
What opportunities and challenges are there in the fintech space at the moment? “It’s always been hard for small business owners to get finance from traditional lenders, and it’s getting harder,” said Matt Bauld, general manager, sales and business development, at Prospa. “So the opportunities in my mind are to step into that gap. “It’s a massive opportunity. The small business market, for example, is huge; there are 2.2 million SMEs in the market. We haven’t scratched the surface.” Agreeing with Bauld, Moula co-founder and CEO Aris Allegos said, “You’ve got 75% of small businesses that are still effectively being turned away from the majors. Even those that are approved, there’s 50% that look at the mainstream process as being ineffective, or difficult or frustrating. “So that’s probably the opportunity for us, because we solve the problem.” Michael Burke, head of sales at OnDeck, anticipates an exciting couple of years ahead for the industry.
36
Michael Burke Head of sales, OnDeck
Abhishek Maharaj General manager, Winquote
“Awareness without a doubt continues to grow,” Burke said. “It’s grown significantly over the last 12 months. I think the trajectory over the next two years is very strong within the industry.” Giving the broker’s perspective, Abhishek
Nancy Youssef Founder and mentor, Classic Finance
Nancy Youssef, founder and mentor at Classic Finance, said fintechs offered more of an opportunity for brokers to be solutionsbased rather than just ‘transactional’. “What the royal commission is showing is that the broker who is focused on transac-
“We’ll continue to do what we’ve been doing for the last four years … to enable our brokers to continue to do what they have been doing” Aris Allegos, Moula Maharaj, general manager of Winquote Finance, said the opportunity that fintechs provided was “another string to the bow” for brokers as the major banks pulled back from the SME space. “We’ve got another broker offer,” Maharaj said. “We can find a home for our customers who are getting no’s from the banks. We’re able to provide them a solution.”
tions is not going to be the broker that will survive the new landscape,” Youssef said. “So, by taking a solutions-based approach, it’s imperative for brokers to know what lenders are out there. “It’s not just important to know it from a product and policy perspective, but I also think they need to know it from a positioning perspective.”
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SPECIAL REPORT
FINTECH ROUNDTABLE
How has the royal commission shown that borrowers need to look at fintechs? “The report highlighted the absolute necessity to put customers first,” Bauld said. “At the end of the day, good customer outcomes are what need to occur, and I think fintech companies are in an amazing position to lead here. We’re challenging ourselves to deliver better and better outcomes.” The focus on customer outcomes resonated with Allegos. “When you boil it down, Hayne was really driving the point that greed and profit were driving bad decisions,” he said. “So, when you look at the platforms we’ve all built, the way we’ve differentiated ourselves from mainstream is very much by putting customer outcomes first. And those customer outcomes are achieved through the ease of process, through the transparency of the products we offer, and just through the general simplicity versus the mainstream offering.” Burke said OnDeck’s position on brokers had remained consistent. “We see brokers as
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SATISFACTION WITH BIG FOUR BANKS VS OTHER BANKS 6 months to January 2018
6 months to September 2018
6 months to October 2018
(prior to royal commission) ( ) = % point change from 6 months to January 2018 (prior to royal commission)
100%
80%
% very or fairly satisfied
And what about the challenges fintechs are facing? Allegos said, “In terms of challenges, I think the two things we really need to focus on as an industry are, one, creating awareness – we are not necessarily an alternative but a mainstream offer for SMEs; number two, instilling trust in the customers that we are again a mainstream offering that can be trusted.” Youssef agreed that creating awareness and educating brokers and customers was important. “Some of the education that fintechs can provide is around how you actually position that solution to clients who only know of mainstream lenders or who have never heard of these fintechs,” she said. “Clients don’t know what they don’t know. They come to you with a problem; our job is to find a solution and really understand what your solution is all about and take it a step further into the sales process and how to integrate that effectively.”
79.2%
75.6%
75.0%
84.9%
84.2%
83.9% (-1.0%)
(-4.2%)
60%
40%
20%
0%
Big four banks
Other banks
Source: Roy Morgan Single Source (Australia), 6 months to January 2018, n = 23,945, 6 months to September 2018, n = 26,457, and 6 months to October 2018, n = 25,304. Base: Australians 14+. 1. ANZ, CBA, NAB and Westpac
a very relevant part of the Australian financial services landscape full stop,” he said. “They’re positioning themselves as trusted advisers to their customers; that doesn’t change. What does change is the
“If there were a fee-for-service model, dealing with fintechs allows us to justify that fee even more, because sometimes the customers won’t have access to lenders or won’t know about them,” he said.
“If I have to say I feel love from fintechs, yes, I do – because they’re a service provider to us” Abhishek Maharaj, Winquote Finance emphasis on creating diversity from an income perspective, and that’s where I think the fintech space becomes a very sound strong alternative to what may have been core income streams historically.” For the broker, Maharaj said there was now a benefit to being able to educate their clients on the alternative solutions available.
“If we’re educating our clients, we’re becoming more relevant, guiding them through the process. The cash flow financing solution is one of the strategies amongst a number of products in the market. “We understand there are short-term goals for our clients, medium-term goals and long-term. In the fintech space with the
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solutions that OnDeck, Moula and Prospa are providing, it’s that short-term solution that allows us to provide that oxygen for our clients.” Youssef said, “I think the royal commission has highlighted that, despite all the arguments about commission or fee-for-service and all those things, ultimately it’s about really knowing your customer and knowing your client and being there to offer solutions at the varying stages of their life cycle or business cycle.”
How are fintechs making brokers more relevant to their customers? Burke said it was about “being able to provide timely and workable solutions so customers could benefit and grow their organisations. That’s fundamentally what it’s about. We speak to brokers, we spend a lot of time in the market talking to brokers, and it is the frustration with mainstream, not just around time, but also decision.” Allegos believes time is a crucial factor. He said, “Having that capability of bringing that time frame to really service their customers is critical. The broker channel is so critical to all of our businesses. We don’t have the awareness of these established brands, so how do we get to market in an efficient manner? We use brokers.” All three fintech lenders said they had been building tools to help brokers and their customers. Bauld said, “We know for an SME customer they’re time-poor and potentially they’re online at three in the morning. So how do we make the broker relevant in that transaction? “We’ve all got fantastic people; we’re all educating, training, we’re building tools, not only to service customer needs and to deliver a fantastic outcome but to help a broker get to market. “I think we’re making a genuine impact, both in the broker community and for the customer, which is pretty cool.” Youssef said one of the best things about using fintechs was the consistency, which
could be a problem when using the bigger banks. “Yes, we can all talk product and policy and rate and solutions and all those things, and that’s great, but it all comes down to consistency,” she said. “When I say to a client, we’re going to have an answer for you in 48 hours, we want to confidently say that.
streamlined processes, because when you’re relying on technology platforms there’s less chance of that process not being followed, or of more mistakes and human error.” Maharaj added, “I think from the fintechs’ perspective to a broker, I feel like our business has a sales force behind it with the support
“One thing that hasn’t changed is the relevance of the broker in the Australian financial landscape. We passionately believe that’s not going to change” Michael Burke, OnDeck “When we say we’re going to try to make this easy for you, we want to say that without saying, ‘I’m also, more than likely, going to ask you for a whole stack of missing information next week, in addition to everything I’ve already collected’. This is the area where fintechs play a really important part with their
that they provide. If I have to say I feel love from fintechs, yes, I do – because they’re a service provider to us. Our responsibility is to then make sure we give them good-quality transactions. They have really mastered the piece in looking after us as brokers, because I feel like I am a person there and I have a say.”
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SPECIAL REPORT
FINTECH ROUNDTABLE
SMES FINDING IT TOUGHER TO GET FINANCE Relatively easy
Relatively hard
Net balance*
50 40 30%
30 20
9%
10 0 -10
-21%
-20 -30 -40
Dec 18
Dec 17
Dec 16
Dec 15
Dec 14
Dec 13
-50
*Net balance is defined as the difference between the percentage with a positive outlook and the percentage with a negative outlook. Source: Sensis Business Index, December 2018
Fintechs are competing against other lenders with branch networks or larger advertising revenues, but Maharaj said that just allowed brokers to serve as the ‘branch’. “We become that presence for them, and that’s where we see that benefit coming in, where even if other lenders open up more branches, who is taking that three-o’clock-inthe-morning phone call? Or the branch is closed on Sundays. “It’s simple things like that where we tend to be that front office and we have a whole bunch of solutions, including what the fintechs can offer.” Burke joked that, while simple relationshipbuilding activities like picking up the phone and talking to customers might seem “crazy” in this digital era, they were still a big part of OnDeck’s business. He said, “An important equation is: fintech does not equal no customer contact. I think in all our organisations it’s still very much about
40
providing customer service – having a point of contact, picking the phone up, building relationships.”
How are you planning on working with the broker industry in 2019 and into 2020? The three fintechs agreed that the changes to the residential side presented some “ambiguity” in terms of how the broader lending space would be affected. Moula’s Allegos said it made things cloudy, but from his company’s perspective nothing would change. “Specifically within the commercial broker category, if anything people are buoyant, they are reinvigorated; this is an opportunity for everyone,” Allegos said. “So, from a Moula perspective we’ll continue to do what we’ve been doing for the last four years, whereby it is an ongoing investment in the education, in the tools, in the platform, to enable our
brokers to continue to do what they have been doing.” Bauld said he recently sat down with his team at Prospa and told them that the one thing they needed to do right now was listen. “There are probably different ways people are going to take the news, and that’s just human nature,” he said. “Some people are going to go, wow, my life is over. For those people, we wrap our arms around them as best we can and try to help them see a future for their businesses. “At the same time, I was at an event last week and I heard a lot of buoyant behaviour from brokers who have been around for a while, saying ‘when there’s change, there’s opportunity, and we’re going to build a better industry through this change’. “I don’t want to create the solution for every broker. I want to, broker by broker, work with them to understand what they’re trying to achieve.” Burke said OnDeck was focused on continuing to educate. “I think one thing that hasn’t changed is the relevance of the broker in the Australian financial landscape. We passionately believe that’s not going to change. As a consequence, we feel as though we’ve got a responsibility to, as each of the other fintechs have, help educate and create greater awareness around our product and our process to help small businesses grow.” Looking forward to the future as fintechs and brokers both continue to grow and develop, Bauld said, “2019 is a time of big changes. But ultimately we’ve positioned ourselves well for those changes. And I think we’ve invested a lot and customers have seen the impact. I see this as a huge year for all of us in this room. “The intermediary market, the brokers, absolutely need to say, ‘There’s an opportunity in front of me’. “We’ve only just scratched the surface of the actual challenge we’re trying to solve. So, is there an opportunity for a broker? Absolutely. Are we backing that? One hundred per cent, like we have from the beginning.”
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FEATURES
OUTSOURCING
Don’t be left behind Facing increasing workloads and the pressure of fast turnaround times, more brokers are being attracted to the benefits of back-office support offered by outsourcing. Three leaders in the space explain
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AS A broker builds their business and fights against the growing mountain of paperwork on their desk, there comes a point where they may consider finding someone to help. Whether they need admin staff, phone support or marketing assistance, more and more brokers are turning to outsourcing to keep their businesses running. One broker who swears by outsourcing says her business would not be where it is today without it. Sydney-based broker Louisa Sanghera offshores tasks such as social media, bookkeeping and processing to Serbia and the Philippines.
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Sanghera runs Zippy Financial, and within a year of starting up she says she felt like she was “drowning” – she was staying up until 2am and only getting four hours of sleep. Her friend recommended outsourcing to her, and not being able to afford a fulltime employee in Australia she knew it was the right way to go. “When I was flat out on my own in the first year I was actually walking away from business and losing it as I didn’t have time to chase the leads,” Sanghera explains. “It’s freed up my time to work on the business, not in the business, as they say.”
She says she simply could not have grown the way she has done without outsourcing, and now she can spend much more time with her two children as well as on growing her business. “You cannot do everything yourself,” she says. “You have to invest in your business in the early days. “I couldn’t afford Australian wages sadly, and outsourcing at the rates you can get abroad allows you to take staff on to help you do the work, freeing up your time to grow your business and work on getting more deals in and over the line.” Andrew Duerden, director of business
services at Loanworks, a company that provides outsourced back-office support and specialised loan processing services, agrees it is a “balancing act” for brokers with so much to work on. “They need to consistently meet their customers’ expectations whilst also fulfilling their responsible lending and compliance obligations; and they need to minimise their costs whilst also building a robust and diversified referral network,” he says. “In addition to this, they need to invest in building their core capabilities that differentiate them from their competitors.
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FEATURES
OUTSOURCING
WHAT CAN OUTSOURCING HELP WITH? Accounts processing Appointments and scheduling Administrative duties Application processing Customer support SEO and website support Marketing and graphic design Personal assistant duties Records managements After-settlement calls General IT helpdesk support
And all of this needs to be achieved within an environment of decreasing commissions and constrained margins.” Outsourcing back-office functions allows brokers to manage those priorities, freeing them up to redirect capital to their marketing, build their sales team and increase their processing capacity, Duerden says. Michael Galilee, CEO at GBSS, which provides offshore business support, says cost savings are one of two reasons a broker might want to outsource. “It goes without saying that there are
waiting for something to happen then being behind,” he says. “Brokers that have embraced offshore staffing are already extremely well positioned for any changes in the market, both positive and negative. “My advice to brokers is, don’t be one of the ones left behind.” In fact, Driscoll says in the last three months alone his company has seen a “significant increase” in enquiries from brokers, which have only increased further since the commission’s recommendations were released at the start of February.
“Brokers that have embraced offshore staffing are already extremely well positioned for any changes in the market, both positive and negative” Garry Driscoll, Boutique Offshore Solutions significant cost savings to be enjoyed via the use of offshore processing structures,” he says. “It is then up to the business to determine how best to utilise those savings, whether it be to assist the business to cope during difficult times, or to perhaps redistribute those savings into other areas such as the growth of the business via marketing or similar investment. “The second reason would be to realign processes so that the business and its key people can concentrate on core functions and, as a result, spend less time being involved in or distracted by tasks or duties that may be of lesser value than the achievement of overall business goals.” Garry Driscoll, president of Boutique Offshore Solutions, a company that sets up and supports outsourcing offices in the Philippines, says the royal commission has shown that brokers need to think ahead and set up their business models accordingly. “This means taking action now rather than
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“The royal commission was a huge wake-up call to brokers to look at their business models and the best ways to compete in terms of service, cost and the ability to be flexible,” he says.
How do you know if you should start outsourcing? For Sanghera, losing hours of sleep and walking away from clients were clear signs that she needed to outsource. Duerden goes into further detail, saying the signs that brokers should outsource include narrowing margins, increasing deal costs and excessive time focused on administration. “From the outset, a mortgage broker should set service levels to complete key tasks, and benchmarks for key performance metrics such as conversion rates, loan amount, monthly volume and customer satisfaction,” Duerden says. “As a mortgage broker grows and nears their defined thresholds, they should start
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FEATURES
OUTSOURCING
engaging an outsource service that meets their needs. Engaging and onboarding an outsource service takes time – it isn’t a silver bullet for solving immediate problems.” Galilee says outsourcing is becoming an easier solution than ever, and anyone who is thinking of hiring onshore should consider whether it can be done elsewhere. “With the numbers of brokers already doing this increasing constantly, and the ease of communication through techno logical advances, strengthening your business through the use of an offshoring provider and business partner has never been easier,” he says. As Sanghera has found, much of the feedback received by these companies has been positive. Duerden said, “The feedback we receive is on how our outsourcing solutions help brokers to increase capacity, grow sales and boost their financial flexibility. We also receive positive feedback with regard to our dedicated learning and development team, our hands-on service delivery experts, and our extensive financial services industry knowledge.” Driscoll says he can give “many examples” of brokers benefiting from outsourcing. “One broker firm who specialised in construction and development loans had been too busy to take on refinances, but once they had their offshoring team trained they were able to accept the additional
business they had to let go in the past. That additional business alone more than paid for their offshore staffing,” he says. However, Galilee warns that brokers can’t just expect positive results without doing any work themselves. “As with everything in business you get back what you put in,” he says. “There does need to be some preparation for such a move, and there need to be open lines of communication, along with an understanding of the cultural differences,
Building a relationship For brokers who are outsourcing, whether offshore or not, some of the work they have to put in includes building a trusted relationship with the team. “Communication and involvement with the offshore team is of paramount importance,” Galilee says. “We strongly recommend the business ‘overcommunicate’ as much as possible to create a culture where the offshore team truly feels part of the big picture.”
“When I was flat out on my own in the first year I was actually walking away from business and losing it as I didn’t have time to chase the leads” Louisa Sanghera, Zippy Financial but that is the job of the offshoring provider to assist in that transition. “Our experiences and the feedback we have heard has been nothing but positive. Taking that first step can be daunting, but it is important to do, as the benefits and results that can be achieved are compelling. It makes our role in this all the more rewarding when we see the positive results for our clients.”
How brokers work with their team can depend on the tasks they give them, Duerden says. But generally, “Loanworks’ outsource solutions are largely based on assigning dedicated staff to a client and supporting them with learning and development, service delivery, IT, HR and finance services,” he says. “In these engagements a broker should expect to build a relationship very similar to any Australian employer/employee
OUTSOURCING AT A GLANCE Business process outsourcing is not just for mortgage brokers; it is a growing industry across the whole of Australia. IBISWorld puts the current size of Australia’s business process outsourcing at:
$35bn revenue
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3.3%
annual growth, 2014–19
30,308 businesses
233,264 employees
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relationship on trust and respect. It is not uncommon for clients to visit our offices in the Philippines or to fly their staff to Australia to build a closer relationship.”
treat them as part of your team you will get their buy-in and they will be far more productive and loyal.” On her experience of working with
“It goes without saying that there are significant cost savings to be enjoyed via the use of offshore processing structures” Michael Galilee, GBSS Driscoll adds, “Treat them as your own staff, with the only difference being that they are located outside your office. If you
offshore staff, Sanghera says, “You have to clearly communicate and be clear on exactly what you want them to do. They are fine using
processing that is recorded and checklists, etc. You’ve just got to cover everything in your communications or it will come back wrong. “For me again that was hard as my staff here are used to rushing and flicking quick messages, but I do have to spell everything out for the outsourcing processors. My admin girl Skypes me all the time and we have great communication. “I flew her over last year for an awards event and she worked with me here for a week, which was good for her as she saw how busy I am, as she hadn’t fully realised via Skype.”
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FEATURES
SELF-EMPLOYED BORROWERS
Breaking the ‘self-employed’ stigma Are self-employed borrowers difficult? Troublesome? Too hard to deal with? Absolutely not. Royden D’Vaz of Bluestone tells MPA why they present great opportunities for brokers
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SELF-EMPLOYED borrowers come from all walks of life and have a wide variety of needs and objectives – family homes, business properties and investment opportunities among them. All these require finance, but brokers have often shied away from working directly with such borrowers. Concerns about complexity and the low odds of approval are often cited. Yet selfemployed borrowers can struggle to find appropriate loan solutions, and brokers are perfectly placed to assist them in this struggle. For Royden D’Vaz, head of sales and marketing at Bluestone, it’s a no-brainer. Small business owners, he notes, are often time-poor and looking for quick, convenient solutions. Brokers can serve as an invaluable resource, allowing them to better focus on where their skills lie – their business.
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Sponsored by
“Brokers generally have a better under standing of the market and the unique value proposition of each lender on their panel,” says D’Vaz. “They’ll be better able to recommend products that are suitable for the borrower’s specific goals.”
How can brokers help? The self-employed market offers several opportunities for brokers. Research by the RBA suggests that the market is underserved and it can be difficult for these borrowers to find appropriate loan solutions on their own, D’Vaz says. “The self-employed borrower segment is a great first step to a more diversified broker business,” he says. “From a broker perspective, most will be very similar to vanilla home loan applications. However, the borrower is
Self-employed versus PAYG Self-employed borrowers cover a broad spectrum of income levels and industries, and that means brokers need to be prepared before diving head first into a new market, D’Vaz says. “This can mean their income is more variable than that of their PAYG counterparts. That’s part of the reason why they often require more substantial documentation.” With that said, home loan applications for self-employed borrowers are not significantly different to those for PAYG borrowers. As in any loan scenario, the borrower will need to demonstrate their income and expenses, and prove they are able to service the loan they are applying for. “The main difference lies in the type of documentation self-employed borrowers have to provide to prove their income,” says
“The self-employed borrower segment is a great first step to a more diversified broker business” Royden D’Vaz, Bluestone more likely to require support because of the increased scrutiny of income.” Additionally, self-employed borrowers are more likely to require ongoing financial support than their PAYG counterparts, says D’Vaz. “Their needs are often more diverse, and a broker’s service tends to be required more frequently,” he says. “For example, apart from purchasing their home or investment property, many self-employed Bluestone borrowers use our solutions to consolidate business and personal debts or set up lines of credit for cash flow support.” Additionally, others choose to cash out equity to grow their businesses or meet payment obligations to suppliers or the ATO. Brokers are the best equipped to provide this kind of sophisticated support, D’Vaz says.
D’ Vaz. “While PAYG borrowers usually only need to provide their two most recent payslips and personal bank records, selfemployed borrowers have to provide more extensive documentation to access the same types of loans.” For self-employed loans to be considered fully documented, borrowers usually need to provide two years’ worth of tax returns, a
notice of assessment from the ATO, and at times their business bank records showing cash flow. “This can present difficulties, depending on when they’re applying for their loan,” says D’Vaz. “Borrowers might not yet have completed their latest returns, or may have been trading for less than 24 months.” In other cases, tax records don’t provide an accurate representation of the business’s position. For example, trading conditions can vary from year to year. Business growth and upscaling – or, alternatively, shrinkage – can lead to significant variance, which loan providers may find concerning. Still, this doesn’t mean the borrower won’t be able to secure a loan, D’Vaz says. “In these cases, many lenders offer solutions that accept alternative documentation to prove income, also known as alt-doc loans. These loans allow self-employed borrowers to use different types of records to prove income, such as BAS, business bank records, or a statement from their accountant.” Once the relevant information is secured, the subsequent application and approval process for self-employed loans is very similar to the PAYG loan process. There is no reason they should be any more difficult to complete. “In Bluestone’s case, our BDMs are always ready to assist a broker and answer any questions that come up along the way,” D’Vaz says. “We also offer a variety of checklists to show what type of documentation brokers and borrowers need to provide for each type of loan application.”
ABOUT BLUESTONE Launched in 2000, Bluestone is a fast-growing non-bank specialising in near prime, residential lending. Our products have been developed with the customer in mind, and with feedback from brokers. They provide solutions for real people. Designed to be flexible, they can be tailored to the individual – homebuyers, self-employed business owners and PAYG borrowers who are unable to find a financial solution with mainstream banking. To find out more, visit www.bluestone.com.au.
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FEATURES
BROKING TECHNOLOGY
The best product as soon as possible Equipping clients with the right loan for their circumstances is crucial to being a successful broker. Pepper’s Aaron Milburn talks to MPA about some of the tech tools brokers can use to better aid their clients
OVER THE years, Pepper has built a reputation for supporting its broker partners in innovative and useful ways. With an increasing emphasis on automation in the mortgage space to encourage efficiency, compliance and best practice, Pepper continues to evolve with the times in order to maintain this high standard. For Aaron Milburn, director of sales and distribution at Pepper Money, it’s fundamental. He is a firm believer that no customer should leave a broker’s office without understanding
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their financial options – but to do that, brokers need to have the right tools. “Being able to afford the property a customer has their eye on is a primary concern,” says Milburn. “So understanding how much they can borrow before committing to purchase may help get them into that home sooner – that’s why we developed an online Borrowing Power Calculator. “ Each customer’s borrowing needs are different and specific to their personal
circumstances, Milburn says. But the Borrowing Power Calculator can give them an idea of how much they can borrow within a matter of minutes. “Based on their income and financial commitments, we can provide them with an accurate insight into their borrowing power,” says Milburn. “Accordingly, this can provide insight into whether they’re looking at the right properties for their current situation, or whether they might need to adjust to suit.”
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Choosing the right product Of course, the client’s journey doesn’t end once their borrowing power has been determined. Brokers still need to work alongside them in order to determine the most appropriate product. Here, Pepper has stepped in again, creating the Pepper Product Selector (PPS). Around 4,000 mortgage brokers around Australia have already used the tool, Milburn says. Pepper strives to make the process easier for brokers, simplifying the steps required and reducing complexity. “During 2018, the PPS returned nearly 9,000 scenarios,” says Milburn. “That represents more than $4bn in indicative offers to their clients, and conversion continues to grow.” The broker simply inputs their client’s details and PPS will return a product match,
“Pepper Resolve has enjoyed considerable success in pilot groups throughout 2018,” says Milburn. “We’re excited for this tool to go mainstream and to see it rolled out across all major aggregators.” This is designed for situations where the customer’s needs may not be able to be met by their first-choice lender. Milburn sees technological tools such as PPS and Resolve as essential to the current environment. Given the wide variety of client needs, it’s something he feels can act as a democratising factor. Customers who’ve had relatively stable financial backgrounds gain greater access to a range of products they might not otherwise have considered. Similarly, customers from non-traditional backgrounds may be able to obtain a level of finance they wouldn’t necessarily have anticipated.
“With an indicative offer at your fingertips, you can continue the conversation with your client knowing there is a genuine solution” Aaron Milburn, director of sales and distribution, Pepper Money with an indicative interest rate and associated fees, Milburn explains. The tool also completes a soft credit check ‘access seeker’ – at no cost. “With an indicative offer at your fingertips, you can continue the conversation with your client knowing there is a genuine solution,” says Milburn. “It saves you the time and effort of sorting through subpar solutions.”
“Tools like Pepper Product Selector can help brokers offer their customers a home loan solution when other lenders have said no,” Milburn says. “Everyone deserves a chance to get ahead in the housing market, and we aim to give brokers and clients alike the advantages they need.”
Future innovations Resolving to help brokers and clients alike Currently, the company is also in the process of rolling out Pepper Resolve, a cloud-based conversion tool designed to provide a broker with an on-the-spot bestfit alternative loan solution.
Looking to the rest of 2019 and beyond, Milburn sees further innovations being created by Pepper. Given the relatively recent release of PPS and Pepper Resolve, Milburn expects further evolution of the technology as the company receives feedback from brokers as well as clients.
PEPPER PRODUCT SELECTOR IN NUMBERS Pepper’s tool to help brokers find the right product for their customers has seen:
4,000
broker users
9,000 scenarios
$4bn
in indicative offers
“We plan to continue to focus on improving the efficiency and usefulness of our broker technology,” says Milburn. “We’re dedicated to ensuring that brokers and borrowers have access to the very best tailored solutions – fast and efficiently.” Most importantly, Pepper’s core mission of helping brokers and clients succeed remains unchanged. Milburn acknowledges that the best approach to this will naturally change over time, but there are core components in place that will allow Pepper to continue with this mission. Working closely with brokers will remain a key factor. “We want to support mortgage brokers to help more customers succeed with their financial goals,” says Milburn. “Our technical tools, coupled with the in-depth relationships we have with our partners, allow Pepper to continue to do what we do best.”
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PEOPLE
BROKERAGE INSIGHT
Making a splash in the housing market Whether first home buyers or experienced investors, Aqua Financial Services aims to provide customers with the tools they need to succeed SINCE 2011, Aqua Financial Services has been providing investors throughout Victoria with its distinctive brand of customer service, helping locals find the finance they need. For Daniel Hustwaite, principal at Aqua, establishing his own business was a logical extension of his broking career. “I had been working as a mortgage broker for around seven years, so I decided to branch out,” he says. “I felt there was an opportunity to work in conjunction with real estate agents and better leverage those relationships.” In 2019, Aqua finds itself in the same position as many other Australian brokerages. The industry is changing: rapid technological shifts are driving both innovation and procedural change, while 2018’s banking royal commission and this year’s impending federal election are also set to drive legislative change. Yet Hustwaite remains relatively unfazed. After more than a decade, he’s well aware of the cycles and demands of any financeadjacent industry. “I started working in finance and banking back in 2000,” Hustwaite says. “So I saw quite a bit even before I moved into broking.” Reshaping the modern market This is not to say there are no challenges, though. Hustwaite points to shifting bank policies as one of the most common in the
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current environment. The increasing amount of information and validation necessary to support a loan application naturally means additional work. “Historically, we used to see minimal changes in bank policy on a month-to-month
These factors have made it much trickier for customers to navigate the loan landscape, Hustwaite says. However, he also believes it has made the role of the broker more important than ever. “The principles of ‘responsible lending’ are
“Where a lot of businesses fall down is in not treating their existing customers as well as their new ones” basis,” says Hustwaite. “However, there are now constant changes around variables such as minimum living expenses, postcode restrictions and exit strategies. It’s become particularly heightened since banks uncoupled their interest rates from the RBA rate.”
currently in a bit of a flux, and accordingly we’ve seen borrowing capacities decrease significantly across the board. This means it’s trickier to get a loan approved.” In tandem with the wider emerging risks in the industry, this gives brokers a prime
AQUA AND THE ROYAL COMMISSION The banking royal commission has understandably dominated public discourse around the broking market over the last few months. But Daniel Hustwaite is eyeing current events with a certain degree of caution and scepticism. While passionate about weeding out bad actors in the industry and having proper procedures in place, he’s also concerned that over-reaction now could have a longer-term negative effect on consumer choice. “We don’t know yet which recommendations will be implemented and what impact they might have,” says Hustwaite. “But we are concerned that some of them could result in poorer outcomes through directly reducing competition.”
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FAST FACTS Company: Aqua Financial Services Principal: Daniel Hustwaite Location: Eltham, Victoria Year founded: 2011 Services offered: Home loans, investment property loans, SMSF lending, commercial and equipment/vehicle finance Number of employees: 12 Awards: • MPA Top 100 Brokers 2018, 2017, 2016, 2015, 2014 • Finalist for Connective Excellence Award 2018 – Broker of the Year • Finalist for Connective Excellence Award 2018 – Brokerage of the Year >5 Brokers
opportunity to reach out and assist their customers in ways they might not have previously considered, Hustwaite says. “I don’t necessarily think tighter loan criteria is a negative in the long term, but it does mean that borrowers will need to adapt to the new environment by balancing their budgets better,” he says. “Based on the depth of conversations we’re having with our clients, we feel this is already starting to happen, albeit slowly.” There’s also been plenty of buzz about the health of the property market itself, with numerous experts pointing to declining prices in many Australian capitals. But again, Hustwaite is philosophical. “The property market has been fundamentally strong over the medium to long term,
except for a brief downturn during the GFC,” he says. “So we feel it’s basically undergoing a period of consolidation at the moment.” However, investors would still be wise to be cautious. “Capital growth will probably be significantly slower than it has been historically,” Hustwaite says. “But it’s important to note that wage growth is currently anaemic. It has not kept up pace with the concurrent growth in property prices.”
2020 and beyond Over the next 12 to 18 months, Aqua will have a continued focus on process management. The aim is to streamline operations as much as possible, ensuring efficiency without sacrificing service.
“The most important thing is that we’ve got to be flexible and adept enough to adapt to the changing regulatory and lending landscape,” says Hustwaite. But, just as importantly, he aims to continue growing Aqua organically by leveraging its existing customer base and building deeper relationships with its strategic partners. “Where a lot of businesses fall down is in not treating their existing customers as well as their new ones,” says Hustwaite. “But you need to make sure everyone is looked after properly; that’s why we are constantly in touch with customers, reassessing their current arrangements and looking at how we can help them get the best possible deal.”
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PEOPLE
CAREER PATH
LIVING REAL ESTATE Juwai.com board member Greg Paramor got into real estate almost by accident and has since become a key influencer in the property industry Greg Paramor began working in real estate in 1972. By 1981, he and his partner at Growth Equities Mutual had built a revolutionary real estate fund with both a capital and an income unit. Then they moved out of Perth 1987 to the east coast and obtained 60,000 investors in three funds and BUILDS AMID A CRASH $1.5bn of debt-free equity. The Investment Funds Association, FALLS INTO “Getting into real estate was a little bit REAL ESTATE then called the Unit Trust Association, of an accident. I was looking for a made Paramor its president when the career shift at the tender age of 21. stock market crashed. He was involved I liked the idea of generating income from in managing several regulatory changes and helped write rules governing commercial activities in real estate. I liked leasing and the property trusts and real estate investment schemes. “There are two reasons to be commerce aspect of it. It was just a natural fit for me.” part of an industry group. One is that we all prosper from what we do, so it’s good to put back in. And two, it’s very good to be part of building better structures by 1994 communicating and working together despite the business’s competitive nature.” BRIDGES THE GAP
1972
Paramor founded Paladin Australia and built an almost $1bn REIT securities fund from the 1990s to 2000s. Through his previous business partnership, he had gained a keen knowledge of REITs long before launching his business. “We started the first REIT securities fund back in 1985–86. That bridged the gap. We could tell investment advisers, “Here is the bridge into the listed market, which gives your investors more liquidity than they can get in the unlisted market.”
2009
REVIVES A BUSINESS Paramor was part of a syndicate that bought LJ Hooker in 2009. He served as a director for about a year, then as chairman until the real estate agency was sold back to Janusz Hooker in 2015. “We took a business that was struggling and losing money. It wasn’t supposed to be, but when we got in there we found it was. We went from a loss of $9m to a profit of $12m in four years, which was alright. That was fun. There was a lot to do.”
2019 and beyond
BALANCES CHARITIES AND BUSINESS Apart from his commercial interests, Paramor will be occupied with a number of charities. His business commitment includes serving on the board of Charter Hall Group, the property company he sold his business to six months ago.
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2003
OVERSEES THOUSANDS As CEO and managing director of property group Mirvac, Paramor managed 5,000 employees and an equally large balance sheet. “I’ve always built my own businesses from scratch. When you’re growing something from zero, you have a very different way of going about it than when you parachute into an organisation with 5,000 people.”
2019
HARNESSES INTERNATIONAL KNOWLEDGE Paramor joined Juwai.com’s board of directors. He aims to use his knowledge of real estate markets in Australia and around the globe to help assist Juwai’s customers. “I’ve always had a big focus on research, client interface and communication. I hope that is where I will be able to add some value. They are a great team.”
“One day when China opens up, I hope Juwai.com can guide investments not just from China to the world but from the outside world into China. All markets tend to open up eventually”
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Hannah Nguyen Director HAH Finance Solutions MPA Top 100 Brokers 2018
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Registration partner
There’s never been a more important time for a national forum to address the issues impacting the industry. Join us for a program covering: • How to future-proof your business in a post-Royal Commission world • How to attract new clients and referrals in the current market • Advice from Australia’s most successful brokers recognised in the MPA Top 100 • PLUS an exclusive half-day masterclass with Canada’s top mortgage broker Shawn Allen of Matrix Mortgage Global
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PEOPLE
OTHER LIFE
TELL US WHAT YOU GET UP TO Email rebecca.pike@keymedia.com
6
Number of months Bundy has been doing Jiu-Jitsu
1.5
Number of years Bundy’s husband has been involved in the sport
1
Number of competitions Bundy has entered
GRAPPLING FOR WELLBEING Jiu-Jitsu provides Bundy Financial Services director Holly Bundy with a way to both escape the grind and unleash her competitive side
“Putting myself out of my comfort zone ca n really be difficult at times. I suppose I’ve always been very competitive”
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LIKE MANY successful brokers, Bundy Financial Services director Holly Bundy can easily get caught up in the day-to-day noise of deadlines and meetings. During the time she was building her business in particular, she found she was neglecting her mental health and physical wellbeing. However, when her husband asked her to join him at the local Jiu-Jitsu gym, Bundy discovered a way to keep healthy and fit while remaining productive at work. “Jiu-Jitsu provides a physical outlet that’s really good for mental wellbeing,” she says. “It’s also a great way to spend some time with my husband.” Sometimes being the only female in her class makes the sport feel a lot like her career, Bundy says. “I’m often the only female successful broker in a room going out against men. I’m this young female running a small brokering business and doing as well as the men who are often middle-aged and have been in the industry a long time." And Jiu-Jitsu can be very practical, just like Bundy's approach to her business. The sport is not always about strength, she says, and she “can still beat the boys based on techniques”. Bundy entered her first competition last year, and it didn’t go as she hoped it would. But she hasn’t let this faze her. “It’s easy to sit back and not push at all,” Bundy says. “But I’m all about putting myself out of my comfort zone.”
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