MPAMAGAZINE.COM.AU ISSUE 21.03
BROKERS ON BANKS 2021 How the winning bank’s team earned the top spot for the second year running FINTECH ROUNDTABLE The sector that quickly adapted to 2020’s challenges
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CONSTRUCTION FINANCE Where the opportunities lie in this booming market
SPECIALIST LENDING Why borrowers are turning to alternative solutions
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MARCH 2021
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CONTENTS
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UPFRONT 02 Editorial
A valuable insight into broker sentiment and bank behaviours
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26 FEATURES
FINTECH ROUNDTABLE
86 400 and OnDeck discuss topics like COVID-19, brand awareness, and the challenges the industry is facing
COVER STORY
Bankwest general manager, third party, explains what the bank is doing to support brokers
10
06 News analysis
Will the merger of BOQ with ME Bank be a challenge for the big four?
08 Lender perspective
How a major bank is seeking to do better for brokers
FEATURES The importance of alternative options for borrowers in 2021
Find out how, after a challenging year, the banks fared in MPA’s annual broker survey
IAN RAKHIT
Brokers show their true feelings about the best interests duty
44 Specialist lending
BROKERS ON BANKS 2021
BIG INTERVIEW
04 Statistics
48 Decision-making
36
FEATURES
CONSTRUCTION FINANCE
This booming sector is full of opportunities thanks to government schemes and low interest rates
Putting your internal tug-of-war to rest with six ways to simplify choices
52 Workplace management
Tips for leaders as they adapt to the post-pandemic workforce
PEOPLE 54 Brokerage insight
The journey of TAG Financial and how it pivoted its business during COVID-19
56 Other life
With a love of the flying trapeze, this broker spends his free time in extreme ways
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UPFRONT
EDITOR’S LETTER www.mpamagazine.com.au
A shift in broker sentiment
H
earing from individual brokers over the last year has provided a good insight into their experiences of working with the banks and other lenders, but we should remind ourselves how pivotal to our industry this interface is. That’s why this issue of MPA is so crucial. It features the annual Brokers on Banks survey results, which show us exactly what brokers think of how the banks performed over the last 12 months. The full details of the report start on page 13, and some really interesting changes emerge from the data – even more interesting than those we saw as a consequence of the royal commission. Understanding the troubles that brokers have been facing with service levels, Commonwealth Bank’s head of third party has addressed those frustrations and outlines how the major bank plans to improve its operations to support brokers
Borrowers’ awareness of fintech lenders is continuing to grow, and they are happier to use them and customers in this issue’s Lender’s Perspective (page 8). We also hear from the winner of the Brokers on Banks survey in our Big Interview and find out how the bank maintained its top spot this year and how it plans to continue its good work in the industry. Not stopping there, MPA also presents its annual Fintech Roundtable report this month. This was another virtual event bringing together two big fintech lenders as well as a regional broker who provides fintech solutions to his customers. It was a great session, with the three participants bouncing ideas off each other and comparing experiences. With OnDeck being a small business lender and 86 400 a completely paperless home loan provider, the two fintechs were able to discuss insights from the different markets they work in. Borrowers’ awareness of fintech lenders is continuing to grow, and they are happier to use them. This was backed by the broker panellist who said three out of four of his borrowers were actively turning away from the big banks and were happy to use banks like 86 400. There’s plenty of content to get stuck into this month. Enjoy it.
MARCH 2021 EDITORIAL
SALES & MARKETING
Editor Rebecca Pike
National Sales Manager Claire Tan
Journalist Tom Goodwin
Global Head of Media Marketing Lisa Narroway
Contributors Adam Croucher, Michelle Gibbings, Aytekin Tank
CORPORATE
Production Editor Roslyn Meredith
Chief Executive Officer Mike Shipley
ART & PRODUCTION
Chief Operating Officer George Walmsley
Designer Cess Rodriguez Traffic Coordinator Kristine Jamir
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 Australia (Mortgage) Pty Ltd Regional head office: Level 10, 1–9 Chandos St, St Leonards, NSW 2065, Australia tel: +61 2 8437 4700 • fax: +61 2 9439 4599 www.keymedia.com Offices in Sydney, Auckland, Denver, London, Toronto and Manila
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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CONGRATULATIONS
Matt Spears EVOKE CAPITAL
1300 303 382 specialistfinancegroup.com.au Australian Credit Licence No. 387025
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UPFRONT
STATISTICS SAVINGS BEHAVIOURS IMPROVE
The best interests duty for mortgage brokers officially came into effect on 1 January 2021. In your opinion, was this a necessary obligation to introduce?
BROKERS ON BEST INTERESTS DUTY The best interests duty came into force at the start of 2021, but according to a survey by HashChing, more than two thirds of brokers do not think it was necessary.
43%
29%
Yes – It was necessary to better help consumers
71%
No – I don’t think it was needed as a statutory obligation
of Australians want to rein in discretionary spending
3 in 10
want to start and maintain a budget
INTEREST RATE APATHY According to a Mortgage Choice study, Australians are not keeping track of interest rates to see if they could get a better deal on their home loans.
1 in 5
want to pay off their mortgage faster
13.7%
Annually
17%
How often do you check your home loan rate? 44.4%
want to tackle credit card and personal loan debt Source: MyState Bank research
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41.9%
Never
Every couple of years
Source: Mortgage Choice
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TURNAROUND TIMES CONTINUE TO BLOW OUT
Given that the best interests duty doesn’t apply to banks, do you think the obligation will lead to a rise in demand for broker services this year?
45%
Yes – I’m expecting mortgage brokers will be even busier this year
Reflecting the level of activity in the mortgage market, lender turnaround times sat at 25 days in the second quarter of FY21 – the longest average response time seen at they have been at any point in the past three years.
55%
No – It won’t make a difference
LENDER TURNAROUND TIMES BY QUARTER Unconditional approval turnaround times
30 23.9
Number of days
25
22.5
19.6
20
20.4
19.7
20.1
21.2
25.2
22.7
21.0 19.8
18.8
16.3
15
FY18 Q2 FY18 Q3 FY18 Q4 FY19 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY20 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY21 Q1 FY21 Q2
Source: AFG Index January 2021
Source: HashChing
FHB CONFUSION One in three first home buyers have ‘minimal’ confidence that they understand the home loan features best suited to them. One in 10 have no confidence at all.
TOP 5 CHALLENGES FOR FIRST HOME BUYERS Understanding how the whole process works
HOME LOAN VALUES HIT RECORD HIGH The value of home loans settled in the month of December 2020 reached another record high, thanks to the lowest-ever interest rates, generous government incentives and borrowers’ fear of missing out.
47% Making sure they are getting the best deal possible
Buyer type
Total value of home loans
Monthly increase
Annual increase
Owner-occupier
$19.94bn (highest ever)
$1.59bn (8.7%)
$5.58bn (38.9%)
Investor
$6.07bn
$459.1m (8.2%)
$598.4m (10.9%)
TOTAL
$26.01bn (highest ever)
$2.05bn (8.6%)
$6.18bn (31.2%)
46% Making sure they qualify for the loan amount and property they want to buy
45% Establishing what they can afford to comfortably pay back
41% Understanding what (if any) government support they qualify for
37% Source: Mortgage Choice
Source: ABS, Lending Indicators December 2020, released 1 February 2021
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UPFRONT
NEWS ANALYSIS
A challenge for the big four The acquisition of a Melbourne-based bank will provide a big advantage for the Bank of Queensland – but will it be enough to enable the regional bank to encroach on the majors’ market share?
THE BIG FOUR banks are set to face a new rival now that the Bank of Queensland has entered into an agreement to acquire 100% of ME, in what has been described as a “defining acquisition” for the bank. BOQ chairman Patrick Allaway said the planned merger was a major step in the bank’s strategy to be the leading customercentric alternative to the big banks. “With the addition of the ME Bank business, BOQ now has material scale and a compelling growth platform to support this ambition,” he said. “The combination of our highly complementary businesses brings together two organisations with a shared purpose and values generating greater value for customers, employees and shareholders. “This is underpinned by the successful revitalisation of the bank since early 2020 with the team’s strong execution capabilities being reflected in our earnings progress to the half.”
A boost to earnings, market presence BOQ managing director and CEO George Frazis added that the ME brand was a great fit with both the BOQ and Virgin Money brands and that it would double BOQ’s retail bank, increase its retail earnings contribution from approximately 36% to greater than 50%, and provide geographic diversification. “This is a defining acquisition in our
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ongoing transformation of BOQ, benefiting our shareholders, customers and people,” Frazis said. “It is an exciting day to see two strategically and culturally aligned businesses come together, and we look forward to continuing to build ME Bank’s strong brand, accelerate growth and create new opportunities for our people and the group. “We are on track with our strategic transformation, and we anticipate that the combination of the two businesses will enable us to accelerate our digital strategy towards a cloud-based common digital retail bank technology platform.”
BOQ may remain weaker, say analysts Analysts at S&P Global Ratings commented that the planned acquisition of ME should consolidate BOQ’s competitive position by increasing its geographic diversity and scale of operations. However, they believed that while BOQ’s market share, franchise strength and pricing power remained
“With the addition of the ME Bank business, BOQ now has material scale and a compelling growth platform to support this ambition [to compete]” Patrick Allaway, BOQ The acquisition will be for a cash consideration of $1.325bn and funded by an underwritten capital raising of $1.35bn. The ME brand will be maintained and grown. Combined, the group will have pro forma total assets of over $88bn, with total deposits of more than $56bn.
broadly similar to those of its regional bank peers, it would still be significantly weaker than the major banks. The S&P analysts also predicted that the intention of the bank to maintain the ME Bank brand had the potential to be successful within BOQ’s existing multi-brand
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EXPECTED POST-MERGER DIVERSIFICATION
Total loans by geography WA
Other
8% 4% Vic
15%
$47bn
Qld
42%
Total
NSW
31%
Pro forma combined Other WA
9%
Qld
10% Vic
21%
$74bn
31%
Total
NSW
29% Source: BOQ Acquisition of ME Bank – Transformational Acquisition and Capital Raising Report
strategy, which includes Virgin Money. “We believe each brand would have distinct target markets, including BoQ’s existing retail offerings under the Virgin Money and BoQ Blue brands,” S&P Global Ratings said in a report. “We also do not anticipate a change in BoQ’s stated regulatory capital targets. By
complete. However, we believe BoQ’s management team, given its experience with other mergers, is well placed to manage such challenges.”
Positive shift in banking landscape The acquisition price represents an implied acquisition multiple of 1.05 times ME’s FY20
“This agreement brings together two culturally aligned organisations to form what will be an enhanced and influential banking alternative for customers” James Evans, ME Bank our projection, BoQ will maintain its riskadjusted capital ratio between 10%–15%, in line with our current assessment over the next two years. “In our view, the planned acquisition exposes BoQ to integration and operational risks until the acquisition is substantially
reported book value and 11.9 times its FY20 cash underlying earnings. The acquisition is targeted to be completed before the end of BOQ’s 2021 financial year, subject to regulatory approval pursuant to the Financial Sector (Shareholdings) Act 1998 (Cth).
ME Bank’s shareholders, who represent 26 of Australia’s industry super funds, unanimously endorsed BOQ’s offer, which was recommended by the board. The chairman of ME Bank, James Evans, said the decision represented a “permanent shift for the better in the Australian banking landscape”. “This agreement brings together two culturally aligned organisations to form what will be an enhanced and influential banking alternative for customers,” Evans said. “The increased scale and complementary offerings will benefit customers and employees alike. The combined group will be able to offer a wider network of service options, deeper resources, and the added reassurance that comes with a larger banking organisation. “BOQ and ME are a natural fit. They are both homegrown banks with a range of simple and easy-to-understand banking products. They both offer a genuine alternative to the big banks. And, importantly, they also share a common language, and that’s the language of customers.”
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UPFRONT
LENDER'S PERSPECTIVE
GOT AN OPINION THAT COUNTS? Email rebecca.pike@keymedia.com
A focus on excellence After a year of high pressure as banks faced a surge in business, CBA is working to provide exceptional service in 2021, says head of third party Adam Croucher THE EXPONENTIAL growth in home loan application volumes has been a topic of conversation for some time. This was particularly the case coming into the last quarter of 2020, and in the month of December Commonwealth Bank grew its balance by over $3bn – one of its highest results on record. This growth has put a considerable amount of pressure on our support teams and operations, which has no doubt impacted brokers’ day-to-day operations. As we head into 2021, our strong focus has been on operational excellence and meeting the everyday banking needs of brokers' customers. At the heart of this is ensuring you receive the best possible service from us because we understand that a sustainable operating model is critical to the success of your business. We continue to deliver new products, technology and services and have made a number of changes to our policies, processes and investment in both overtime and onboarding a significant number of new operations team members.
rollout this financial year. This will give brokers the ability to use the same serviceability calculator as CBA Credit Assessors, resulting in greater visibility and consistency. The new serviceability calculator, which also aligns to our policy, will save you valuable time and lead to better customer outcomes. Last year we also launched an updated version of our Home Loan Pricing Tool and
A strong focus for us has been on operational excellence and making sure we’re meeting the everyday banking needs of your customers our new valuation platform CommVal. These market-leading solutions have been piloted with brokers to ensure that we’re listening to your feedback and providing tools that deliver a simpler, better process for you.
People Product Our new CommBank Green Loan will make it easier for your customers to purchase and install renewable technology, including solar panels and electric vehicle charging stations as part of our commitment to the responsible global transition to net zero emissions by 2050. This is a historically low 0.99% p.a. secured fixed rate loan for eligible CBA customers to fund up to $20,000 in renewables repaid over 10 years with no set-up, monthly service or early repayment fees. After a pilot in February, national rollout is scheduled for May 2021.
Technology We are piloting a new and improved serviceability calculator with a planned national
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complex cases so we can keep your application moving and get a timely response back to you. We have also looked at ways of driving the use of technology to improve our turnaround times. Given the unpredictable nature of COVID, ensuring customers can sign documents digitally through our DocuSign and SmartSign capabilities has been a key focus for us. We were able to stand this solution up
In addition to bringing on nearly 400 new team members, our existing credit assessors and processing teams have been doing thousands of hours of overtime to make sure applications are reviewed as quickly as possible. Our Rapid Response Taskforce is tackling this issue head-on, and operations, technology and frontline staff have been mobilised to bring SLAs back to an acceptable level.
Processes To address the huge uplift in volume, we have made a number of process changes to ensure we efficiently handle the huge number of applications coming through the door. For example, we have introduced on-the-spot coaching for credit officers dealing with more
quickly during COVID and will be rolling it out for all customers as a full DigiDocs process in a phased approach over the coming months.
Policies Our recent changes to liability verification and conduct requirements will help improve the credit assessment process while maintaining strong consumer protections by reducing the amount of documentation home loan customers are required to provide. This will be achieved by harnessing world-leading technology and better utilising the data we collect to achieve improved customer outcomes. We know that turnaround times and managing customer expectations have been challenging, so I’d like to thank all our broker partners for your support and patience over the past year. Adam Croucher has been general manager, third party, at Commonwealth Bank of Australia since January 2019
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PEOPLE
BIG INTERVIEW
IAN RAKHIT: A COLLABORATIVE APPROACH After another incredible year of top rankings in MPA’s Brokers on Banks survey, Bankwest’s general manager, third party, explains how the bank has worked through the uncertainties and challenges of the past 12 months
TWO YEARS AGO, Bankwest was celebrating as brokers voted the bank as the second best in Australia in MPA’s Brokers on Banks survey. This year, it’s celebrating its second year in the top spot. Winning medals in all 10 categories, the bank has done well to continue to impress brokers over a year that was full of challenges and uncertainty. Ian Rakhit, general manager, third party, says Bankwest aims to be known as the best broker bank in the country, acknowledging that it can only achieve that by working closely with brokers to deliver the services, tools and support they want and need. “Developing and maintaining strong relationships with brokers has always been central to our broker model, which meant that when the world was struck by a global pandemic we were fortunate to already have in place many of the initiatives that brokers needed,” Rakhit says. “I’m incredibly grateful to the broker community and appreciative of the collaborative relationship we’ve worked hard to build with them, and I’m proud of the care
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and commitment shown by my colleagues to our brokers, both of which are reflected in this award.” Rakhit says last year was one “like no other”, and while it resulted in banks bringing in new initiatives like electronic identification and end-to-end digital home loan experiences, Bankwest strengthened its relation-
“Bankwest is proud of the BDM model it has developed in response to broker feedback and needs, and our BDMs do a fantastic job, but they are also enabled to deliver the service brokers need and expect by the colleagues, tools and services that support them,” Rakhit says. “I come back to the importance of our
“I’m incredibly grateful to the broker community and appreciative of the collaborative relationship we’ve worked hard to build with them” ships with brokers in other ways. The bank’s BDM model has been designed with brokers in mind: BDMs are complemented by broker support managers, meaning a point of contact is always available. Bankwest achieved a gold medal for its BDM support, showing that this model is working well; the bank’s score in this category was the highest in the whole survey.
collaborative relationship with brokers because support is meaningless if it’s not what brokers actually need, so we look to provide a model that enables brokers to engage with us in ways that best meet their needs. “That means complementing our case ownership model and BDM/BSM relationships with high-quality phone support, our web chat functionality that’s exclusive to
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PROFILE Name: Ian Rakhit Title: General manager, third party Company: Bankwest Years in the industry: 30+ Highest score in Brokers on Banks survey: 4.65 out of 5 for BDM support Lowest score: 3.62 out of 5 for interest rates
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PEOPLE
BIG INTERVIEW
brokers, our extensive self-service options in the Broker Portal, and face-to-face support where appropriate.” Communications, training and development was another important category in which Bankwest achieved a gold medal. In a year like 2020, these three areas were critical, and supporting brokers in safely delivering the best possible service to customers was a key focus for Bankwest. One of the ways it achieved this was by improving its onboarding experience for new and returning brokers through timely and
and support brokers’ needs,” Rakhit adds. Despite the uncertainties of 2020, the year saw record home loan applications. While this was great for brokers who had originally been concerned about what 2020 would look like for them, it also meant increased turnaround times. Bankwest dropped from second to third place in this category in the survey, but it has done a lot over the last year to make sure it provides acceptable SLAs. Rakhit says the bank’s digital home loan process allows customers to sign their
“Our technology tools and offerings play an important role in complementing the critical aspect of our relationship with brokers” targeted communications throughout their journey. This was complemented by the development of virtual broker accreditation training. Bankwest also launched its Connect series offering insights to small businesses. It opened this up to brokers to support them in managing issues related to JobKeeper, cybersecurity, HR and cash flow, for example. As brokers adapted their businesses over the year, a lot of the training and support also focused on diversification, for which the bank also received a gold medal. Rakhit says Bankwest appreciated this recognition of the work of its team in small business and commercial lending. It has a dedicated Broker First team to support brokers from scenario to completion for applications below $1m. “Brokers are so important to Bankwest that they occupy one of our three key strategic priorities, and our Broker First team, as with all teams that work with brokers, only deals with brokers, which ensures they are best placed to understand
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contracts digitally from any device within minutes, reducing time to settlement from about 13 days to fewer than seven working days for new loans and just 24 hours for increases to existing loans. Bankwest’s Broker Portal is also popular with brokers and provides a range of digital self-service tools to make dealing with the bank simple, consistent and efficient. “Our technology tools and offerings play an important role in complementing the critical aspect of our relationship with brokers, particularly our case ownership model, which ensures single-person responsibility for the processing of an application,” Rakhit says. “Bankwest also responded to the active housing market and heightened refinancing levels by increasing the number of colleagues in the processing team, while adding an initial review as applications land to advise brokers of any outstanding information required.” Rakhit adds that the review has been welcomed by brokers “as they can gain any missing pieces of paperwork whilst valuations are underway”.
MEET BANKWEST’S BROKER SUPPORT TEAM
Peta Allen Executive manager, Third Party Support Team
Lisa Daff State manager NSW
Joshua Ellis State manager WA
Kerri Siedofsky State manager Qld/SA
Ben Walker State manager Vic/Tas
Rakhit says it is important to acknowledge that Bankwest’s strong reputation and recognition in this year’s Brokers on Banks survey is a reflection of the collaborative partnership and relationship it has developed with its broker network. “Bankwest and brokers together have worked hard to build that relationship, and I would expect to maintain a strong reputation with brokers for as long as we remain genuinely committed to listening, understanding and working with them to address their needs,” he says. “We want to be known as the best broker bank in the country, and we can only achieve that by working closely and collaboratively with brokers to deliver the services, tools and support they want and need, to make their jobs and dealing with us as easy as possible.”
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8/03/2021 12:09:00 PM
COVER STORY
BROKERS ON BANKS
BROKERS ON BANKS 2021 The impact of COVID-19 is clearly seen in the results of this year’s survey. But despite some of the more harsh criticism of the banks by brokers, the top two have maintained their ranking from last year, achieving even higher scores WHEN THE coronavirus pandemic hit last year, no one knew what to expect, but the financial services industry braced for a difficult year. As Australia was thrown into lockdowns, there were fears that demand for housing and business finance would slow. But while there was a large drop in the number of home loans in April, consumer confidence grew as restrictions eased, interest rates fell and the government announced incentives like the First Home Loan Deposit Scheme. Mortgage brokers saw a huge rise in the number of enquiries from first home buyers, which, alongside refinances, made up much of their work over the last year. The increase in demand, however, resulted in bank SLAs dropping, and that is one of the biggest pain points mentioned throughout this survey. It is great to see that the top two banks have
maintained their positions from last year, but some of the other banks have not been so lucky. The major banks in particular have been badly affected. Two years ago, the winner of the Brokers on Banks survey was ANZ. The major bank dropped down to fifth place in 2020 but scraped into the Top 10 list at number nine this year. NAB, which was in third position last year, has dropped to fifth place in 2021 – and is the highest ranked of the big four. Despite winning some medals, including one gold, Commonwealth Bank was let down by its BDM support and turnaround times. It fell from third place to seventh this year. Westpac, which was in eighth place last year, did not make it into the Top 10 at all. It’s not just poor turnaround times that have led to these results. Amid all the challenges and
mayhem of last year, brokers and banks needed clear communication between them, and while many banks upped the ante in terms of training and support, others fell behind. However, some of the highest scores in the 2021 survey were for the banks’ BDM support. BDMs were on hand over the last year answering questions, running through deals and checking in on brokers. With the royal commission leading to continued scrutiny of how the banks are performing, MPA added the new category of ‘brand trust’ to the survey this year. The results give a real insight into how not just brokers but their customers trust the banks. Read on for more highlights of the survey and an analysis of the results. Thank you to everyone who took part this year and provided valuable insight into how the banks have worked with you over the last 12 months.
TYPICAL RESPONDENT
Aged between 46 and 55
Writes $20m–$40m worth of mortgages a year
Has been in the industry for more than 15 years
Is most likely to work in NSW
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COVER STORY
BROKERS ON BANKS
PRODUCTS AND PRICING With the RBA rate cuts of the past 12 months, the pricing of home loans has certainly improved. One bank in particular has made great gains this year in the ranking not only of its interest rates but its product range, credit policy and diversification opportunities
FOR ALMOST three years the RBA cash rate sat at 1.50%, and banks still increased their rates out of cycle as they battled global funding pressures. Then, in mid-2019, the rate began to drop, and in November 2020 it reached an incredible low of 0.10%. Funding pressures eased and banks also began dropping their rates; now, mortgage rates are at lows never seen before. At the time of going to print, the lowest variable rate was 1.79% for 60% LVR or 1.99% for 80%. With a lot of borrowers struggling in
had improved or worsened in the last 12 months, they said the results were much the same as in the last two years. Interest rates also had the lowest rating in the gold medal rankings this year, showing that while this category was voted second most important, brokers were not happy with the banks in this area. The answer to the follow-up question – asking which banks were passing on the best savings to customers – suggested why that might be.
“Most banks are [passing on interest rate savings]; however, they are not offering the same products to their existing clients”
DO YOU BELIEVE CHANNEL CONFLICT EXISTS? Major problem Minor problem Not a problem
12.50% 27.60%
59.90%
Survey respondent 2020, whether due to job losses, reduced hours or job uncertainty, banks also upped their customer recruitment strategies. They offered introduction rates and cashback incentives as the market saw a surge in refinancing. Despite the drop in interest rates and the incredible offers from the banks over the last year, brokers remain cautious. Asked whether product ranges and pricing
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One of brokers’ complaints, which is not a new one and was also highlighted in last year’s survey, is that the banks are primarily helping new customers. “Most banks are [passing on interest rate savings]; however, they are not offering the same products to their existing clients,” said a WA broker. And a broker from Queensland said, “All are still targeting new customers –
smaller banks are doing well to compete considering they haven’t had the government handouts that the majors have.” Brokers also said the banks, especially the majors, were simply not competitive. “Despite the big four offering the lowest four-year rates, their comparative variable rates are so uncompetitive that it erodes any savings,” said another Queensland broker. “Plus, the fixed rate offerings are usually
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2021 HIGHLIGHTS: PRODUCTS AND PRICING
Interest rates
Product range
Product diversification opportunities
Credit policy
2021
2020
2021
2020
2021
2020
2021
2020
1st
Bankwest
Bankwest
Bankwest
Bankwest
CBA
Macquarie
Bankwest
Bankwest
2nd
Macquarie
Macquarie
Macquarie
Macquarie
Bankwest
Bankwest
CBA
Macquarie
3rd
NAB
ING
CBA
CBA
Macquarie
CBA
Macquarie
CBA
“Despite the big four offering the lowest fouryear rates, their comparative variable rates are so uncompetitive that it erodes any savings”
HAVE PRODUCT RANGES AND PRICING IMPROVED OR WORSENED OVER THE LAST YEAR?
Survey respondent
Improved significantly
9.38%
Improved
44.27%
No difference
36.98%
Worsened Worsened significantly
8.85% 0.52%
very restrictive. So, while they appear to be offering great deals, they are actually more expensive than the smaller banks, who I channel most of my loans through.” In terms of best interest rates, Bankwest has remained in the top position for three years in a row. Brokers said they knew what they were going to get with Bankwest, and that was simply good, competitive rates. Macquarie won the silver medal for rates for the second year in a row. Bronze was taken by major bank NAB, which replaced last year’s winner, ING. It was not just about pricing, however; brokers were also asked to rate the banks on their products. The top three banks in the product range category held their positions from last year, with Bankwest taking top spot again. Brokers praised the ease of use, fast turnaround times and great product
features of its Complete Package. Bankwest also won the gold medal for its diversification opportunities – an important area as brokers have had to spend time pivoting their businesses to deal with various challenges over the past year. Several brokers highlighted the bank’s support of construction funding, praising it for not charging additional fees and for providing the same interest rates. The only category under products and pricing in which Bankwest did not receive a gold medal was credit policy. Instead, for the second year in a row it took the silver medal, falling behind CBA, which swapped places with Macquarie. This was the only gold medal received by CBA in 2021, and one of four medals it received in total – the most of any of the major banks.
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8/03/2021 1:12:02 PM
COVER STORY
BROKERS ON BANKS
SUPPORTING BROKERS Off the back of a year of uncertainty and change, brokers are looking for greater clarity and communication from the banks
THE IMPACT of the pandemic in 2020
down the list, which is interesting because these areas were such a high priority for brokers in 2020. Bankwest once again held the top spots in both categories, but notably, there were no major banks in the top three for commission structure this year. NAB was knocked off its third-place spot, and instead Adelaide Bank joined the top three, pushing Macquarie out of second place. This was Adelaide Bank’s only medal of the survey, although its overall rankings
completely shifted brokers’ priorities. Last year, banks’ commission structure was the most important consideration for brokers, presumably because of 2019’s focus on potential changes to broker remuneration. This year, commission structure has dropped towards the bottom of brokers’ list of priorities as they place higher importance on turnaround times, interest rates and credit policy. Communications, training and development was also slightly further
were still high enough to secure it fourth position overall. Next year’s Brokers on Banks survey will take place as the industry ramps up for the review into mortgage broker remuneration, so it will be interesting to see if this affects the results in this category then. Two years ago, the major banks were much more successful in these areas. ANZ won gold for its commission structure, with NAB taking second place. ANZ also won gold for its communications, training and
2021 HIGHLIGHTS: SUPPORTING BROKERS
Commission structure
16
Communications, training and development
Brand trust
2021
2020
2021
2020
2021
1st
Bankwest
Bankwest
Bankwest
Bankwest
Macquarie
2nd
Adelaide Bank
Macquarie
Macquarie
Macquarie
Bankwest
3rd
Macquarie
NAB
CBA
ANZ
ING
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Bankwest once again held the top spots in both categories, but notably, there were no major banks in the top three for commission structure this year development, with CBA in third place. This year, CBA was the only major bank to get a medal in these categories, securing thirdplace position for its communication, after dropping off the podium completely last year. While brokers did rank communications, training and development particularly highly this year, their responses highlight how important this support still is to them. Some brokers said they had stopped doing business with banks because of their low levels of support. On working with one bank in particular, a Queensland broker said, “I got burnt with two or three different files for various reasons, mainly due to poor communication and terrible assessment times and processes in the background.” The number-one bank in this category received particular praise. Of Bankwest, a NSW broker said, “Very easy bank to deal with. Broker Chat online is great; my BDM always answers her phone or calls back quickly and has a can-do attitude.” A lot of other brokers also praised Bankwest’s BDMs, while others commended the bank’s “flexible policy” and “common-sense assessors”. “Their BDM is amazingly responsive, their products are very customer-friendly, their policies fit our clients well, and their assessment teams look for reasons to approve loans, not to decline. They’re very proactive to deal with and have a ‘can do’ approach,” said a broker from SA.
TECHNOLOGY, TURNAROUND TIMES AND SERVICE The biggest pain point for borrowers and brokers over the last year has been lengthening turnaround times as banks fight to pull in new customers and struggle to keep up with their workload
ONE OF the biggest shifts in this year’s survey is in the proportion of brokers who think turnaround times have worsened in the past 12 months – but that comes as no surprise. It’s been one of the biggest problems of the last year, as banks had to deal not only with supporting their existing borrowers with repayment deferrals and refinances but also new business that came through government
While 28% of brokers in last year’s survey said turnaround times had improved, only 7% said so this year. Almost 91% said turnaround times had got worse. One broker described them as the “worst turnarounds in 30 years”. Lenders, banks and aggregators alike had to fast-track digital tools when lockdowns and restrictions meant in-person meetings became
“The document lodgement platforms are extremely slow and cumbersome and are a far worse situation. IT has let us down” Survey respondent incentives like the HomeBuilder grants and the First Home Loan Deposit Scheme. Seeing how they could benefit from the record-low interest rates, many banks also began offering customers cashback incentives to switch over to them as borrowers hunted for better rates.
impossible. Although this should have helped speed things up, as technology not only saved brokers time but allowed for faster processing, it doesn’t appear to have done that. Asked what tools or technological improvements had helped with turnaround times, some brokers mentioned broker portals,
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8/03/2021 1:13:20 PM
COVER STORY
BROKERS ON BANKS digital VOI services and e-signatures. Many, however, were much more critical. In fact, some brokers said technology had actually worsened turnaround times. “The technology that has been implemented has all seemed to worsen our situation,” said
IT has let us down and has not kept up with the industry.” In positive news for Macquarie, it kept its top spot in the turnaround times category. In a year when brokers felt let down by speed, the lender managed to maintain its reputa-
In a year when brokers felt let down by speed, Macquarie managed to maintain its reputation in this area a Queensland broker. “BankStatements has meant a worse situation for us. The document lodgement platforms are extremely slow and cumbersome and are a far worse situation.
tion in this area. Bankwest lost its secondplace position from 2020, swapping places with ING to come in third. All of the major banks did poorly in this
category, but NAB scored the best out of the big four and Westpac the worst. BDM support received the highest gold medal score out of all the categories: Bankwest achieved 4.649 out of 5, holding on to its gold medal from last year. The bank’s BDMs were highly praised in comments from brokers. Macquarie held on to its second position from 2020, but ING replaced NAB in third place this year. While the major bank scored higher than the rest of the big four in this category, it fell behind Adelaide Bank, AMP and Bank of Queensland. ING also made great gains thanks to its online platforms and services, jumping to gold position in 2021 from eighth in this category last year.
IS THERE A PARTICULAR TECHNOLOGICAL IMPROVEMENT (EG NEW BROKER PLATFORMS) THAT HAS REDUCED TURNAROUND TIMES?
Yes “The adoption of DocuSign by lenders – improves approval to settle and improves customer experience” – Qld broker
“Turnaround times are still the biggest trouble for brokers. Technology should be improving them, not making them worse” – Vic broker
“New broker platforms have made loan status tracking much easier. ApplyOnline docs uploading has become far less tedious!” – WA broker
“There have been no enhancements that have improved turnaround times, but plenty of reasons why they have worsened in the big four, notably cash rebates and offshore call centres, lack of BDMs” – NSW broker
“Bankwest broker platform ‘all in one’, and we love the message platform” – SA broker
“No – turnaround times have got worse across all banks” – Qld broker
“Bank of Melbourne Broker Hub (launched recently) has helped significantly” – Vic broker
“No, I believe it is staff working from home and minimal training and volumes which have made it worse” – Tas broker
“Broker portals with great loan tracking tabs help” – NSW broker
“No, turnaround times across the whole market have got progressively worse except for a few lenders (ie Macquarie, ING, Bankwest)” – WA broker
“Bankwest Broker Portal great for pricing, live access and broker chat” – NSW broker
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No
“No. Technology in general has made processes harder and needs to be drastically improved” – WA broker
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2021 HIGHLIGHTS: TECHNOLOGY, TURNAROUND TIMES AND SERVICE
Turnaround times
BDM support
Online platforms and services
2021
2020
2021
2020
2021
2020
1st
Macquarie
Macquarie
Bankwest
Bankwest
ING
Bankwest
2nd
ING
Bankwest
Macquarie
Macquarie
Bankwest
CBA
3rd
Bankwest
ING
ING
NAB
Macquarie
Macquarie
HAVE TURNAROUND TIMES IMPROVED OR WORSENED OVER THE LAST YEAR?
70.83% Worsened significantly
19.79% Worsened
2.08% No difference
5.73% Improved
1.56% Improved significantly
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8/03/2021 1:13:49 PM
COVER STORY
BROKERS ON BANKS
WHAT YOU’RE SAYING Brokers have felt the impacts of the last year in many areas. Here’s what they had to say about COVID-19, channel conflict, responsible lending changes, and the assessment of living expenses ON TOP of the challenges of COVID-19 over the past year, brokers have been impacted by regulatory changes as well. The best interests duty came into force in January – a consequence of the royal commission report released by Commissioner Hayne in 2019. The government has also been discussing the potential of removing responsible lending laws from the National Consumer Credit Protection Act (2009) in order to boost economic recovery. Brokers have often said banks are taking the assessment of living expenses to an extreme, another factor that has contributed to lengthy turnaround times. These strict criteria have also meant that broker workloads have increased as they scrutinise details in customers’ bank statements and do reworks. With changes to responsible lending, banks would continue to comply with APRA’s lending standards requiring sound credit assessment and approval criteria, but the reforms would allow lenders to rely on the information provided by borrowers, “replacing the current practice of ‘lender beware’ with a ‘borrower responsibility’ principle”. Asked what they thought the impact of such changes might be, some brokers did not expect to see any difference. Others believed it would be a real positive for the industry and some said it would be a bad thing. The survey also asked about channel conflict, a big concern of brokers in recent years. Their main issue this year was that direct-tobank loans were being turned around much faster than through the third party channel.
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PRIZE QUESTION: IMPACT OF COVID-19 How has COVID-19 impacted the lending environment for better or worse? “COVID has not slowed down the market. Property prices are still booming; refinance activity is strong. Lenders’ temporary COVID policy changes are fair.” “The mortgage industry is experiencing stress. As COVID-19 severely blunts the economy, and unemployment reaches levels unseen even in the previous financial crisis, many households struggle to keep up with their mortgage repayments.” “I feel it improved as people had more time to talk and realise that they were paying for loyalty, so we saw more refinances.” “It made us focus on communications with clients. Facetime, Zoom and other platforms are now built-in ways to do business.” “[It was] worse for the self-employed, with 25% income reduction. Better for enabling flexibility on borrower repayments when they do not report it as arrears.” “Mixed. Tighter policy and rules have made it worse. Incentives and better rates made it better for clients to borrow and repay debt quickly.”
Star comment “COVID has had a mixed impact on the lending environment, but more wins than losses I think. There have been some big wins, ie adoption of electronic signatures on application and mortgage docs, enabling video ID, and low interest rates for consumers. However, it had an adverse effect on some lenders’ abilities to process a loan and have documents issued!”
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HOW HAVE YOU FOUND BANKS’ ASSESSMENT OF LIVING EXPENSES TO BE OVER THE PAST 12 MONTHS? “Bad, as this is always changing and there is no dead-set rule on how they verify, ie client spends less or a certain percentage under HEM, then they will scrutinise the deal.” “Awful. Assessors are looking for things that aren’t there. Some lenders have a good handle on this, where others are still scared to approve any loan other than a vanilla deal. The lack of maturity in assessment teams is growing, unfortunately.” “Fine – we have detailed discussion with our clients and also check statements and discuss further.” “Inconsistent, with big differences in how they view things and what they require.” “Terrible and inflexible. The belief that last month’s spend (without a mortgage) is going to be the same as the spend when the client has the responsibility of the new mortgage is illogical.” “Too stringent from some lenders – they need to take a more realistic approach.” “Taking more of a common-sense approach. Still reviewing expenses but not forensic.” “Varied and improving. Some extremely tight, not practical; others which are easier to understand and more realistic.”
WHAT DO YOU THINK ABOUT THE PROPOSED REMOVAL OF RESPONSIBLE LENDING LAWS? “For consumer protection, responsible lending laws must not be removed.” “Great stuff – there will always be affordability checks and common-sense checks, but at the moment, they’ve tipped too far.” “Ethical mistake – will lead to bad debts, delinquencies and problems later.” “Could be a good opportunity as long as the borrowers understand what they are doing and are being trustworthy.” “Good initiative. One-size-fits-all responsible lending laws do more harm than good.” “I will still adhere to them to protect myself, but I do believe the lenders have taken it too far when it comes to living expenses.” “I don’t think they should be removed, but they could certainly use some adjustment.”
HAVE YOU EXPERIENCED CHANNEL CONFLICT? “SLAs for the big banks are considerably longer than if clients deal directly with the branch.” “Clients can go into the branch and get a loan approved on the spot, whereas brokers have to wait with longer service levels.” “Differing turnaround times; branches trying to steal customers from the broker network; branches approving loans that should not be written.” “Client walks into a major bank and gets approval in days; client goes to a broker and with the same bank takes 40 days to get an approval.” “New channel conflict area is turnaround times. Powerful weapon for majors to approve applications in two to four days in branches but it takes four to 10 weeks for third party introduction applications. Combined with the usual stealing of loans when the client completes a variation such as a switch to fixed.” “I haven’t had a large number of issues – but have had branches offering next-day approval when it’s taking us three weeks for a file to be picked up (during 2020).” “Advertising higher refinance incentives for direct-to-bank enquiries than are available via the broker channel was always going to create channel conflict, but compounding that by lowering service turnaround to brokers shows a lack of respect for supply lines.”
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8/03/2021 1:14:18 PM
COVER STORY
BROKERS ON BANKS
FINAL RESULTS For those banks that held on to their medals or rose up the ranks after a year like 2020, it was a great achievement – find out how the overall winners earned their reputations over the past 12 months BANKWEST Position in 2020: 1st Position in 2019: 2nd MPA: Your product range was praised and you achieved a gold medal. What did you offer borrowers? Ian Rakhit, general manager, third party, Bankwest: Broker feedback is a constant part of our strategy, and we made amendments to the Complete Package at the end of last year, moving the offset and card products to optional. This was welcomed by brokers who see the benefits of the package in terms of flexibility and rate but had advised that some customers were not seeing the benefits of the additional products. We also made our upfront valuations free for all brokers, helping to widen our appeal and give brokers certainty at a critical moment. MPA: You came top for your commission structure. Why is this important to brokers, and what did you do in this area? IR: We made some amendments to our commission model, notably removing the six-month review, and Bankwest is keen to maintain its pro rata or tiered model over the first 18 months, so if there is clawback it lowers as each month passes. This has been described to me as the most transparent and fairest model in the market.
“We also made our upfront valuations free for all brokers, helping to widen our appeal and give brokers certainty at a critical moment”
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MACQUARIE Position in 2020: 2nd Position in 2019: 8th
OVERALL RESULTS To generate the overall results MPA took an average of the results of every category of service. This means every category had an equal impact on the final results.
MPA: You achieved a gold medal and an impressive score for your turnaround times. How did you do this?
Bank
Overall score
Bankwest
4.09
Macquarie
3.98
ING
3.68
4th
Adelaide Bank
3.54
ING
5th
NAB
3.47
Position in 2020: 4th Position in 2019: 6th
6th
AMP
3.43
7th
CBA
3.37
8th
BOQ
3.34
9th
ANZ
3.23
10th
Suncorp
3.21
Ben Perham, head of personal banking, Macquarie’s Banking and Financial Services Group: As a committed partner to the broker industry, we know how important turnaround times are in providing clarity and certainty at each stage of the home loan journey, so we’ve invested a lot in this space over the years to make sure we’re getting it right. We get great feedback from our broker partners, who can in turn let their clients know an answer so quickly. It gives them the added peace of mind to know that when they work with Macquarie and submit all the required documentation for an application, they’ll get a fast response – often within a matter of hours. We’re proud to be able to offer this type of market-leading service, and to receive a gold medal in this category is really a reflection of that effort. Our ongoing focus and dedication to the broker industry over so many years has centred on being relentless about delivering the best possible experience for both brokers and their clients.
MPA: You got a gold medal for your online platforms and services. What did you offer brokers, and why was it so important to them last year? Glenn Gibson, acting head of retail, ING: COVID has brought with it a multitude of disruptions for brokers over the past 12 months. Unsurprisingly, our approach has been to do whatever we can to make their working lives easier. For example, we know that brokers would find it hard to get face-to-face time with their clients, so we introduced video-based identity verification and multiple electronic signature options brokers could choose from for loan applications. I believe we were one of the first banks that made these available to assist our brokers. Not to mention, our digital platforms have always rated very highly with our customers, and we wanted our brokers to have the same experience. To that end we launched our Broker Portal in 2020 as well. The layout and functionality of the portal made it a lot easier for brokers to find the information they required.
Note: Scores go from 1 (very bad) to 5 (very good)
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8/03/2021 3:02:31 PM
COVER STORY
BROKERS ON BANKS
BROKERS’ PICKS As well as ranking the banks in each of the 10 categories, brokers were asked to name their favourite mortgage products of the last 12 months. These are the top four bank products as picked by brokers BANKWEST Complete Home Loan Package
Offset Home Loan Package
For the third year, brokers have picked Bankwest’s Complete Home Loan Package as their favourite product of 2020. They were extremely positive about this product, for many of the same reasons as last year. It was praised for its good rates, flexibility, and the ability to have multiple offset accounts. “Overall, one of the most competitive packages with low variable and fixed rates,” said one broker. Another said, “Having an excellent interest rate and the ability to connect up to nine offset accounts makes this one of my ‘go to’ products.” Some brokers also praised its flexibility for construction loans. “Excellent product and the bank does not discriminate on construction for interest rate,” one said. “There are no additional fees charged for construction, only one simple package fee, which is great from a savings point of view.”
This product is the second-highest-ranked mortgage product for brokers for the second year in a row. Brokers praised the Offset Home Loan Package for its multiple offset accounts, great rates and fast turnaround times. Brokers also said Macquarie had great support, in terms of both its online tools and its BDMs. One broker said the bank had “the best app in the industry”, on top of “sharp rates, good turnaround times, multiple offset accounts”. Another broker summed it up: “Great rates, very fast assessment turnaround times; good assessors who don’t overanalyse and pick files apart; common-sense and commercial approach to loans; great product features; great BDM support; easy sell to clients; great feedback post-settlement; e-Docs for loan documents; overall easy process and good support.”
ING
24
MACQUARIE
ADELAIDE BANK
Orange Advantage Home Loan
SmartFix Home Loan
ING’s Orange Advantage Home Loan is a hit with brokers again this year. They loved the ease and transparency of the product, its good pricing, flexibility, and the bank’s turnaround times. One broker said, “Great loan product, great low rate, easy-to-use internet banking, great service, lots of happy clients.” Many brokers found that their clients did not want to leave the bank once they had their loan with ING. “[ING] has a lower annual fee than others, is a very trusted brand in Australia, and once clients are in they are very reluctant to leave. The servicing has also improved due to the decrease in the assessment rate, which has allowed more of our clients to use ING,” one broker said.
A new addition to the top four products this year is Adelaide Bank’s SmartFix Home Loan. Brokers loved the 100% offset account, which one broker said was “unheard of”. Others spoke of its low rates, the option of additional repayments, and “common-sense servicing”. One broker said, “[It] provides a low fixed rate of 2.05%, offers up to $20k additional repayments per year, allows redraw during the fixed period, and offers 100% offset at a cost of $15 per month, which is equivalent to $180pa – half that of comparable higher variable rate products with offset.” Another said, “This gives clients the ability to have certainty with repayments but also to pay off the debt quickly. Almost every client wants both of these.”
1
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8/03/2021 1:15:26 PM 5/03/2021 9:30:42 AM
INDUSTRY ROUNDTABLE
FINTECH LENDERS
Making life easier with tech While the big banks had to adapt to a new way of doing things when the restrictions came in last year to combat the COVID-19 pandemic, fintechs were ready with their digital tools and processes
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TECHNOLOGY IS not a new concept in the financial services sector, but it has been given a significant boost over the past 12 months thanks to the COVID-19 pandemic. Over the last several years new tools have been introduced to help combat issues such as long turnaround times and mundane tasks, but certain processes have remained manual and face-to-face for a lot of the bigger banks, like verification of identity and document signing. In particular, fintechs led the way in the move to digital and paperless years ago, with 86 400 introducing the first 100% paperless home loan in November 2019. Other online lenders, like OnDeck, which lends to small businesses, have been offering online application forms and digital verification for some time. But not everyone has been quick to take up these options, with many brokers and borrowers still preferring elements of face-to-face and manual. While this sentiment has been shifting over the last few years, the forced move to online when we couldn’t meet in person last year has sped things up. Fintech lenders were already in a great position to meet the need for online-only services, so their teams made a swift transition to working from home and using digital tools to approve loans, while offering the same level of customer service and speed. After a challenging year for the small business lending sector – a space that many fintechs reside in – the two fintechs joining MPA MPA’s ’s 2021 roundtable were an interesting mix to hear from: a smartbank offering home loans and an online small business lender. We compared the two different landscapes over the past year, how each of them responded to those different environments, and how they saw these areas continuing to change. They also talked about their relationship with brokers, and our third panellist was a broker who gave his insights on what the fintech industry was like to work with, particularly over the last year. MPA would like to thank George Srbinovski from 86 400, Cameron Poolman from OnDeck and broker Nic Casey from The Finance Collective for taking time out of their busy schedules to share their views at this year’s roundtable. Read on to find out what they had to say and about the work they are constantly doing with brokers in mind. The next event to look out for is MPA MPA’s ’s Non-major Banks Roundtable, which will feature in our April issue.
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INDUSTRY ROUNDTABLE
FINTECH LENDERS
THE PANELLISTS
Nic Casey Managing partner, The Finance Collective
Cameron Poolman CEO, OnDeck Australia
MPA: It’s been a challenging 12 months for a lot of people. What can you tell us about your experiences of the last year? While acknowledging that 2020 had been difficult for many people, 86 400’s national manager of broker distribution, George Srbinovski, said it had been a year of growth for the smartbank. Even after the move to working from home, the fintech hired new staff for its BDM team and lending operations, credit and settlement teams. It also expanded out into WA with a new BDM appointed in that market, and joined the panels of AFG, Mortgage Choice and Connective. Commenting on what borrowers and brokers have needed over the past year, Srbinovski said, “Brokers are after speed and transparency. Throw in a bit of innovation, great rates, and they’re the four main pillars
“With BID coming in, I can’t put a first home buyer [with a lender] knowing that I’m saying to them, wait 33 days. Nor should I,” he said. “A bank like 86 400, all of a sudden they’re at the top of the queue purely because the client says a quick turnaround is needed.” OnDeck Australia deals with a different segment of the market: small businesses. When the lockdowns first began in Australia in March last year, many of the fintech’s customers had to close their businesses and were really struggling. CEO Cameron Poolman said 30–40% of its small business customers reached out to OnDeck to say they were facing a potentially difficult time, so the lender deployed most of its staff into customer service to see how they could help them. But by the end of 2020, OnDeck saw a shift in the sector. Poolman said the fintech was now seeing what he called a ‘K’ recovery.
“With BID coming in, I can’t put a first home buyer [with a lender] knowing that I’m saying to them, wait 33 days. Nor should I” Nic Casey, The Finance Collective
George Srbinovski National manager of broker distribution, 86 400
28
of what brokers are looking for.” As a mortgage broker who submits loans through 86 400, Nic Casey, managing partner at The Finance Collective, said the smartbank’s ability to “grow on the run” was a credit to it. “You would not know that these guys are multiplying each day; turnaround times haven’t blown out – I bet you 99% of banks wish they could say that,” he said. Casey explained that turnaround times had been hugely important when it came to choosing a lender for his customers, particularly for first home buyers who are inexperienced and anxious when waiting for their loan to be approved.
“You’ve got small businesses that are really struggling, small businesses that might be in international tourism, as a classic example, but then there’s these other businesses that are doing really well,” he said.
MPA: We’ve seen a fintech recently give up its banking licence, and at the same time new fintechs are still emerging. What opportunities are there in the fintech space? Towards the end of 2020, Xinja gave up its banking licence and handed its deposits back to customers. But this doesn’t mean other fintechs are destined to go the same way.
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SMALL BUSINESS CONFIDENCE RISING According to the Sensis Business Index for Spring 2020, small business confidence is rising again after falling during the height of the pandemic.
SMB net confidence: 2019–20 Confident
Worried
Net balance
70% 60% 50% 40% 30% 20% 10% No v2 0
Oc t2 0
Se p2 0
Au g2 0
Ju l 20
Ju n2 0
Ma y2 0
Ap r2 0
Ma r2 0
Feb 20
Jan 20
De c1 9
No v1 9
Oc t 19
Se p1 9
Au g1 9
Ju l 19
Ju n1 9
Ma y1 9
Ap r 19
Ma r 19
0% -10%
Source: Sensis Business Index, Sept–Nov 2020
Poolman said that while no one was going to come in and beat the major banks, there were still plenty of opportunities for fintechs. “It’s where you can produce a better customer experience, be more efficient and delight the customers better than the incumbent,” he said. “We think in small business lending, particularly to these small-cash-flow type businesses, the banks aren’t particularly good at it. They’ve got processes that are slow and systems that are built for lending larger amounts of money to larger corporates, and so that’s a niche for us to be able to be successful in this space. “I think there’s lots of little niches, whether it be payments, whether it be lending or banking to particular customer sets, and that’s where I think there are opportunities.” Srbinovski said 86 400 had focused on getting the basics right and then innovating from there. He said fintechs needed to build a sustainable model and offer innovative products to “compete against the status quo”. “86 400 is the first, and from my knowl-
edge the only, paperless home loan application for brokers,” he said. “That’s a way that we looked at a segment of the market and were able to innovate out of that and offer brokers’ customers a speed to decision they can’t get in many other places.” From a broker’s point of view, Casey said
lenders, and whether borrowers were happy to accept them, he said “absolutely”. “Once you’re on a roll and you’ve had a good experience, it’s a lot easier from a broker’s point of view to sell it to the consumer and to give the consumer that confidence that this is a new brand but
“I’m very specific about the types of BDMs that join us, as their servicelevel expectations back to brokers have to be at a really high level” George Srbinovski, 86 400 every bank was “99% the same”, but fintechs like 86 400 and OnDeck had been able to come out of left field and offer something different. He said the ones that had stumbled had not offered anything different enough to break the market. Asked whether brokers were happy to offer home loan solutions from fintech
they’re a streamlined process, they’re paperless, they’re backed, they’ve got all the same government guarantees,” Casey said. “People are willing, and probably more willing than ever, to get away from mainstream banking. That’s what we’re finding. The confidence is there – from a consumer point of view it’s just a different logo.”
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INDUSTRY ROUNDTABLE
FINTECH LENDERS “[The opportunities are] where you can produce a better customer experience, be more efficient, and delight the customers better than the incumbent” Cameron Poolman, OnDeck
MPA: How do you feel the past year has impacted borrower awareness and sentiment when it comes to fintechs? In the early days of the fintech industry, lenders had to fight against a lack of brand awareness, but over the last couple of years there has been a noticeable shift. With 2020 forcing more people online, even for things as important as home loan applications, it makes sense that fintechs are levelling the playing field. The broking industry also achieved a record market share, with 60.1% of all home loans in Australia going through a mortgage broker. With brokers being the main source of distribution for many fintech lenders, this is promising. Srbinovski said the broker channel had really helped out 86 400 over the past year, explaining that the smartbank had continued to grow because brokers were recommending it to their customers. “The trust that customers put in their brokers is second to none, and then being able to offer 86 400 or OnDeck or any of these other fintech guys and say, these guys are a true alternative to what’s currently out there, in return our borrower confidence in 86 400 has increased,” he said. While brokers were busy over the past year keeping up with demand in the mortgage market, it was a bit different in the small business sector. Poolman said 2020 was a year split in two in terms of the impact this had on business: fintechs did gain credibility because of their ability to navigate the market, but there was a shift away from those offering small business loans as demand for them declined. “Brokers have been very busy dealing with mortgages, so for us trying to keep them interested in small businesses that are desperate for credit has probably been one of our challenges,” he said. “So we’re out and about saying small businesses are out and thriving. I think in the last few months once again we’ve got our place in providing that quick credit for customers to grow.”
BIG GROWTH IN FINTECH SECTOR In the year to December 2020, the industry grew by more than 100 new fintechs, predominantly in the blockchain and cryptocurrency space. The number of neobanks doubled from five in 2019 to 10 last year, and 26 more fintech lenders joined the market.
Areas of growth in fintech landscape Category
2020
2019 (reclassified)
Change (#)
Change (%)
Lending
103
77
26
33.70%
Neobank
10
5
5
100.00%
Regtech
47
48
-1
-2.10%
Middle and back office
67
65
2
3.10%
Payments
151
143
8
5.60%
Blockchain and cryptocurrency
81
32
49
153.10%
Wealthtech
79
78
-1
-1.30%
Insurtech
59
35
24
68.60%
Data and analysis
36
37
-1
-2.70%
Capital markets
53
43
10
23.30%
Personal finance management
27
27
0
0.00%
Infrastructure and platform (reclassified)
0
16
-16
n.a.
Crowdfunding
20
23
-3
-13.00%
Total
733
629
104
16.50%
Source: KPMG Fintech Landscape 2020
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INDUSTRY ROUNDTABLE
FINTECH LENDERS
“People are willing, and probably more willing than ever, to get away from mainstream banking. That’s what we’re finding. The confidence is there” Nic Casey, The Finance Collective
As banks and lenders switched to online tools, it made things different not only for the borrower-lender relationship but also for the broker-lender relationship. Casey said the last year had shown who the better BDMs are in the industry, now that people are relying less on face-to-face relationships. “You see the bigger BDMs or the bigger banks have switched purely to an email, or you’re getting these generated emails that are for everyone,” he said. “But your smaller banks and your relationship-driven banks have still made sure that the BDMs are calling two times a week, and you’re still receiving all the merchandise and all of that.” Based on what he had experienced with his own customers, Casey said borrowers were much happier now to go to a lender that is not a big four bank. “We have clients now where three out of four choices aren’t the majors, and the clients are not even blinking their eyelids,” he said. “They’re coming to us because we’re the professionals, and we’re giving them the information that they believe is right for them. More so, it comes back to how I am performing and giving confidence to the client.”
MPA: What’s it been like getting customers and brokers to use digital tools? Has it been an easy transition? While technology and online forms had been around for some time prior to COVID-19,
there were still face-to-face and paper elements being used, as well as segments of both the broker and borrower markets who had chosen not to take up digital tools. With the restrictions of 2020, this had to change. Not only were meetings done online, but verification of identity and document signings were also forced to become digital. Srbinovski said every borrower was different, and some customers did require a little more help than others. He added that 86 400 had armed brokers with tools and information so they could explain to borrowers how the fintech was using BankStatements.com as a safe way to collect income and expenses, and how OCR Labs was used for its VOI. “The tools have been around in the broker market for quite a while, so brokers are experts in positioning that it’s safe and secure and it’s an easy way for this specific lender to verify your income and expenses, for example,” Srbinovski said. “I think for us, with our totally paperless home loan application, customers are starting to get used to using these tools to help speed up the decisioning.” As things slowed down for small business lending, OnDeck spent some time making sure its systems and processes were easier for borrowers using its digital applications. “We’re successful when we make life easy for customers,” Poolman said. OnDeck launched a new product called Lightning Loans that involves no qualitative judgment; the applications go straight through
WHAT’S HOLDING BACK ADOPTION OF FINTECH?
70%
of businesses have not adopted any fintech solutions
48%
of businesses cite high banking fees as a pain point
53%
of businesses cite cybersecurity as a barrier to adoption
Source: Airwallex, CPA Australia: The Role of FinTech in Modernising Business, 2021
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the system with an offer, terms and price based on the information input. It also built a new credit score called Koala, which is more predictive and pulls in customer data, commercial data and cash flow data. “It gives us a lot more visibility around partnerships, sole players and other small businesses, so what that will mean for customers is a lot more of these will get these automated decisions come through,” Poolman said.
MPA: How have you focused on working with brokers over the past year? With brokers being a main distribution channel for fintechs and facilitating 60% of home loans, it was imperative that fintechs continued to work closely with and support brokers in 2020. As Srbinovski had already mentioned, 86 400 made it a priority to expand its BDM team with representation in WA. He added, “We’ve also doubled our broker support team and our lending operations team. We’ve made improvements in our credit team as well. So to continue, like Nic said, to manage our SLAs even though we’ve had great growth and also to continue to serve more brokers.” Unlike 86 400, which naturally needed to grow after launching into home loans in late 2019, OnDeck was already established in its field, and the fintech made sure it maintained its team size, albeit in a slightly different structure. “We maintained the team throughout 2020 but with a slightly different role during that period in terms of keeping in touch with our brokers and customers; and then we re-engaged the team towards the end of last year,” Poolman said. “Obviously, now we’re doing as many faceto-face calls as we can and explaining a lot of the new innovations we’re pushing through in the business.” Casey said he could definitely see a difference between how lenders like 86 400 and OnDeck supported brokers when compared to the bigger banks.
“We looked at a segment of the market and were able to innovate out of that and offer brokers’ customers a speed to decision they can’t get in many other places” George Srbinovski, 86 400
BROKER PERSPECTIVE MPA: Having been on the frontline last year, can you tell us what borrowers have needed from you? Nic Casey, The Finance Collective: When COVID hit it was very much about making sure customers were OK and making sure I gave them confidence that the government was going to support them – and if they were in small business that what they had done to that point was all well and good, but using the word ‘pivot’, you need to change a few things to get through this period. Ninety-five per cent of my clients have got through this unscathed or come through it on the other side better. Hospitality is the only thing in rural or regional Australia that has really taken a hit; everywhere else – logistics, construction – they’re all booming, which is a fair chunk of my book, which is lucky. So, what they’ve needed from me is actually to find credit, because the applications and the people that we’re seeing are ready to go.
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INDUSTRY ROUNDTABLE
FINTECH LENDERS
TOP CHALLENGES FOR TECHNOLOGY BUSINESSES
33%
Approach to people management
27%
Accessing growth funds
21%
Attracting key talent in sales, business development and tech support
Source: Macquarie’s Banking and Financial Services Group’s inaugural Technology Pulse Check, 2021
He said it was nearly “a step back in time” at the banks, while fintechs were taking a more relationship-based and personalised approach.
MPA: What are some of the challenges facing the fintech space? A particular challenge for 86 400 at the moment is finding the right people with the right attitude, said Srbinovski, particularly as the bank grows its BDM team. “I’m very specific about the types of BDMs that join us as their service-level expectations back to brokers has to be at a really high level,” he said. “But also, we’re a new lender and a fintech lender as well, and they need to understand that component of a business and to grow with that lender, so really resourcing talent is the main challenge.” Agreeing that hiring people was key, Poolman also called out the importance of access to capital. He said fintechs needed people answering phones and office spaces in order to help customers. “We’ve all got to concentrate on making
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sure we’ve got a viable niche and we’re really clear in terms of what our value proposition is,” he added. “In Australia, we’ve got 25 million people; it’s not like we’re in America or elsewhere, so it’s making sure we’re building to the right scale to ultimately be a good business that is profitable and cash flow positive.”
MPA: What else will you be focusing on in 2021? The panellists were positive about the year ahead. Poolman commended the Australian government and people on how they navigated the difficult environment of 2020. He said he was optimistic about economic growth, and that there would be demand from small businesses and consumers and new opportunities for brokers. “We’re going to engage more and more brokers around the country to make them aware of these small business loans so these small businesses can access this money,” Poolman said. “A lot of them are going to want to grow quickly this year and take advantage of the situation, so I think we’re well suited to be able to solve that.”
“Now we’re doing as many face-to-face calls as we can and explaining a lot of the new innovations we’re pushing through in the business” Cameron Poolman, OnDeck
Srbinovski said he was optimistic as well and would also be making sure 86 400 continued to get out in front of brokers and the wider home loan market. The smartbank plans to join more aggregator panels, to continue to innovate, and to reduce the time to a yes or no decision. “2021 for us is going to be another incredibly busy year and one where we want to continue to grow and support brokers and, more importantly, support brokers’ customers on their home loan journey,” Srbinovski said. Growth was also top of mind for Casey, who said that, while refinances had been strong in the past year, he was also seeing a lot of homeowners moving out of the cities to the regional areas, and he expects that to continue. “From my business’s point of view, we’re in a big growth phase, but our number one thing is making sure that our quality doesn’t drop.” Casey said. “That’s one thing that we pride ourselves on. We never overpromise and under deliver, so that’s going to be our biggest thing for 2021.”
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FEATURES
CONSTRUCTION LENDING
Building customers for life Government incentives on top of record-low interest rates have led to a skyrocketing of new home construction over the last year. Two non-bank lenders explain to MPA what brokers need to know about this booming sector WHILE OVER recent years the construction of dwellings in Australia had steadily declined, at the start of 2020 the outlook was positive. As the pandemic then took hold, economic uncertainty slowed demand for new builds, and the number of dwellings approved fell to an eight-year low. Thankfully, the government announced its HomeBuilder scheme last June, and a sharp rise in dwelling approvals and construction finance followed. In fact, by the end of 2020 new house approvals were at their highest level since 1999. New loan commitments for owneroccupier construction of dwellings also reached a record high of $3.52bn in December. Prior to 2020, the highest total loan value was $2bn less than this. So, as demand continues, what are the opportunities in this sector for brokers? And what do they need to know about offering construction finance if they haven’t worked in this area before? Getting a loan for a construction project
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is a little different to applying for a home loan. Lenders assess construction loans by looking at the existing and future equity of the finished product. Rather than the borrower receiving all the funds at once, the loan will be progressively drawn down at various stages of construction.
are being completed. They also look at the capability and track record of the builder or developer in the case of larger projects. Bannister warns that another thing to look out for is “overcapitalisation on projects”. “Often in the pursuit of their ‘dream home’, borrowers can spend a lot of money on items that add little or no value to the finished product,” he explains. “Whilst there is nothing wrong with having the best house on the street, lenders do give regard to the future marketability and saleability of the property and may be concerned where borrowers are investing a sum greater than they are likely to get back.” When applying for construction funding, borrowers will usually need to provide planning permits, building contracts, councilapproved plans, the full list of specifications, evidence of builder’s insurance, copies of related reports such as on environmental and hazardous materials, and any presales or prelease schedules. There are also key terms and concepts associated with construction lending, and brokers need to become familiar with each lender’s terms and requirements as they can vary from lender to lender. Supra Capital, a private lender that offers
“Once you have successfully assisted a client in arranging their construction finance, brokers are likely to find that they have a client for life” Cory Bannister, La Trobe Financial Knowing what to look out for La Trobe Financial chief lending officer Cory Bannister says lenders consider a few things when approving construction loans. For one, they need to know that the borrower can service the construction loan at the same time as paying rent or a mortgage on the home they are living in while the works
senior debt for pre-development site funding and senior and mezzanine debt construction funding, prides itself on its ability to provide flexible and tailored financial solutions. Its managing director, Adriana Zuccala, says brokers do need to be aware of a few risks, though. “The biggest risks for construction lending
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STEADY GROWTH IN NEW BUILDS APPROVED New dwellings approved, year to Dec 2020
20,000 18,000 16,000 14,000 12,000 10,000
Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 Source: ABS Building Approvals, December 2020
are exposure to the financial security of the builder, and potentially the ability of presale purchasers to procure finance for settlements, which will generally be the exit strategy for the construction facility,” Zuccala says. “Alternatively, if the construction facility is funded without presales, market risk.” La Trobe Financial finances construction of both residential and commercial projects, from simple renovations through to multi-dwelling residential and commercial development
projects. Bannister says it’s not just its products that set it apart from other lenders. “We have a dedicated loan underwriting team of 20 specialist credit analysts responsible for assisting brokers and their clients to navigate the construction approval process, making it easy for those who have not yet developed strong experience in this area,” he explains. “Additionally, our credit team are backed by a team of 12 experienced project managers
who work with borrowers and builders to ensure that projects are progressing on time and on budget, as well as ensuring that the builders are paid in a timely manner.”
Opportunities for brokers Ultimately, once a broker understands construction finance, being able to offer these loans is a great attractor of business. “Noting that they are slightly more complex in nature than a regular home loan, this can
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FEATURES
CONSTRUCTION LENDING
HOMEBUILDER APPLICATIONS BY STATE Total applications as at 29 January 2021 New builds
25,000
23,391
20,000 15,000
Substantial renovations
18,124 14,495 12,807
10,000
8,416
5,000
2,397
2,051
0 NSW
Vic
Qld
WA
SA
Tas
ACT
296 NT
Source: Australian Treasury, treasury.gov.au
mean that borrowers will seek the guidance of an experienced broker,” says Bannister. “Once you have successfully assisted a client in arranging their construction finance, brokers are likely to find that they have a client for life.” While many customers seeking construction finance will get in contact with brokers themselves, there are also things brokers can be doing to find potential borrowers. Zuccala says borrowers may approach brokers for other things that can lead to a conversation about construction funding. “A broker may consider discussing construction funding where a customer has requested land funding and intends to procure a permit during the facility term,” she explains. “This may indicate a requirement for construction funding at the expiration of the land funding, to assist the customer
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to develop the land once it has procured a permit. “Similarly, if a customer has procured a permit and intends to market the land
policy continues, Zuccala says growth in the construction space is likely to continue. “Provided the impacts of the pandemic on the financial and property markets are not significant, immigration restarts, and unemployment levels do not deteriorate, we expect the construction market to steadily improve,” she says. “Assuming the proposed vaccination programs allow a return to national and international travel by 2022, construction will continue to be strong.” Agreeing that the state of the construction landscape depends on factors like the COVID vaccine and the reopening of international borders, Bannister predicts the road to recovery will be long and challenging. He says that while there are positives, like low interest rates, high levels of liquidity, and buyer demand exceeding supply, there are negatives that could present hurdles, like potential further outbreaks of the coronavirus. “The key downside risk for 2021 is Australia’s ongoing closed international border, which will slow demand for housing from immigration and temporary international student and worker populations,” Bannister says.
“Assuming the proposed vaccination programs allow a return to national and international travel by 2022, construction starts should exceed pre-COVID-19 levels by 2023” Adriana Zuccala, Supra Capital to obtain presales during the term of the facility, this will indicate a requirement for construction funding at the expiration of the land funding term.”
High hopes for construction lending If Australia successfully overcomes the impacts of COVID, and positive government
“Considering these factors, we expect construction activity in the detached residential housing sector to perform well, with activity in commercial and highdensity housing markets to be subdued until borders reopen. For brokers, we see a sizeable and improving opportunity in the detached residential housing space.”
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FEATURES
TECHNOLOGY
The data road map for success Using data can show lenders, aggregators and brokers where to tweak their processes and how to improve their results. NextGen.Net’s Tony Carn explains how the tech company’s benchmarking service is making a difference in lending
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Sponsored by
THE YEAR 2020 was a record one in the property market, in terms of prices, demand and broker market share. But alongside these positives there were also increased turnaround times and lower conversion rates, as well as a much-increased volume of ‘more information’ requests. Realising that much of the data it already collects could help tackle these pain points, NextGen.Net set out to offer a unique benchmarking service that allows lenders and aggregators to see where they sit in the wider industry. For instance, lenders can use its Industry Benchmarking Reports to track how their time to approval compares to what the rest of the market is offering, as well as their volumes, percentage of more-information requests, and conversion rates. The service also allows lenders to do a deeper dive into the profiles of those volumes: at how they compare across the market when it comes to self-employed borrowers, refinances, different LVR bands, construction loans, and so on. Using these comparisons, lenders can begin to have conversations about what they need to do to improve or maintain their results, says NextGen.Net chief customer officer Tony Carn. “2020 has been a record year of volumes, and the broker market in particular stepped to the forefront,” Carn says. “But with that increased volume has come increased pressure and strain, and what a lot of lenders discover is they don’t actually have the scalability that they would like. “It’s important that they’re getting the best efficiencies in obtaining those turnaround times and keeping the customer off-market and achieving the right conversion rates as well. So, using the data to identify problems and reducing the friction in the process through an action plan is absolutely critical for everyone involved.”
“With increased volume has come increased pressure and strain, and what a lot of lenders discover is they don’t actually have the scalability that they would like” Tony Carn, NextGen.Net How is the data being used? Beyond helping lenders understand where they sit in the market, the benchmarking service helps them identify the pain points in their processes. Carn says one of the most prevalent examples of that is not getting the identification of applicants right: this is driving a lot of more-information requests and in turn impacting turnaround times. Knowing where there is friction in the process, lenders can then begin to take the steps to improve it. Carn says there have already been great results from lenders who are using the data in this way, particularly with those who do a ‘deep dive’. Aggregators are also using the data to see which brokers are getting the best turn-
around times and the lowest number of more-information requests, as well as the trends related to declaring living expenses. “It’s about looking at that and saying, well, as a broker, what are the things that are in my control? Where am I getting my more-information requests? Why am I getting reworks? What are my times to approval? How do they compare to the market?” Carn says. “We’ve seen brokers’ market share continue to rise, and it’s because of the valuable role they continue to play. The factors that contribute to things such as time to yes and more-information requests are, however, largely driven by lender processes and lender policy; and even pricing, for example, influences those.
PRAISE FOR NEXTGEN.NET’S BENCHMARKING Adelaide Bank was one of the inaugural NextGen.Net partners to utilise the company’s benchmark reports and apply the findings. The bank’s general manager, Darren Kasehagen, says he recognised the value immediately. “Over the past three years we’ve significantly increased our overall volumes, our market share and our contribution to group profit. A part of that turnaround has been due to the market insights provided by NextGen.Net,” Kasehagen says. “Not only could we see how we were tracking independently from an absolute loan processing time frame perspective, we were able to see how those times compared to the market. So, rather than relying on anecdotal feedback, either from our BDMs or brokers, we had statistical evidence to make decisions and seek improvements. “We’ve been able to utilise the NextGen.Net information to help track our internal performance versus that of the industry. That’s incredibly important for us to be able to point to an independent viewpoint and set of data to help validate our progress.”
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FEATURES
TECHNOLOGY
“That’s where the value is for a broker to hand-hold people through that minefield and ask, how do I secure your approval? How do I do it in a timely and efficient way, etc.? It’s always about how do I continue improving that.”
What has the feedback been like? The value of NextGen.Net’s benchmarking service has been commended by lenders and broker groups who have used it, and Carn says the data has found its way into boardrooms worldwide. He says for NextGen.Net the accuracy of the data is really important: no assumptions are made; it is made up of replicated production indicators and is as close to real time as possible. Occasionally, users will come to NextGen.Net and ask about dissecting the data even further, and that is something the group is continually working on. “A recent example has been lenders asking us if we can start benchmarking debt-toincome ratios, which is obviously very topical, so we’ve been able to deliver on that,” he says. “Also, we’re looking at how we benchmark volume and per cent flow for first home buyers by state and different categories and how can we provide it in real time. “We are proud to say that at the end of 2020 we provided these benchmark reports to the first broker group where they can slice and dice the data themselves in real time. That means on a daily basis broker groups and lenders can assess what’s happening at
the frontline. The data is powerful, and the insights they provide are of massive value.”
How will this continue to evolve? As users come forward and ask questions about what more they can do with the data, the service is “always evolving”, Carn says. In fact, NextGen.Net has a number of new
“There should be no other priority than to start at the top, understand the data, go into the detail, and have that action plan for capitalising on the opportunities” Tony Carn, NextGen.Net types of report in the pipeline. But he says where it can evolve the best is when users can go beyond the analysis and start to break it down into practice. “The key thing is looking at the headline data insights, analysing them, and then actually having an action plan to say, OK, what are we going to do? What opportunity are we going to tackle first? Are we going to implement this and within what time frame? “As I said, we’re seeing great results across the market where people are taking that approach as early adopters.” Carn encourages lenders, aggregators and brokers alike to take the time to embrace and understand the numbers. He says a lot of people have different priorities, but when you consider the money spent on loan processing,
ABOUT NEXTGEN.NET NextGen.Net is Australia’s leading technology provider to the lending industry, focusing on delivering quality products and services to a range of banks, non-bank lenders and brokers. Its mission is to make lending easy through the delivery of state-of-the-art software solutions from point-of-sale electronic application lodgement, assessment and processing through to settlement. NextGen.Net’s objective is to provide smarter solutions for now and what comes next – delivering best-in-class software as a service (SaaS) and leading the market in quality management and processing efficiencies.
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understanding the numbers like this should be a top priority. In 2020, there were around 1.4 million mortgage applications lodged, and Carn says these would have cost around $3bn to $5bn just to process. He believes this makes it critical that lenders are achieving good turnaround times, keeping their customers
off the market, and getting the right conversion rates. “When you bring back those numbers, the billions of dollars that we collectively spend on processing, there should be no other priority than to start at the top, understand the data, go into the detail, and have that action plan for capitalising on the opportunities out of it,” Carn says. For NextGen.Net as well, the data is incredibly useful. The group identifies the pain points in the processes and innovates to offer lenders tools to help overcome them. Being able to digitally verify identification documents was a key example last year. “We are problem-solvers, and we utilise our data insights to feed directly into our innovation road map. Our mantra is continuous innovation, and our aim is to reduce the friction in the loan process and make it easier for all parties,” Carn says, pointing out that open banking will also assist with that. “Open banking is all about accurate real-time consumer data that can be leveraged to improve experiences, and I think that’s where we’re going to continue to see a lot of new tools come into the ecosystem that we’re fortunate enough to assist the industry with.”
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FEATURES
SPECIALIST LENDING
(Near) priming brokers for new deals Specialist lending is on the rise as borrowers and brokers alike look for alternatives outside of the mainstream lenders. Di Robinson of Pepper Money explains to MPA what’s driving this trend
SINCE ENTERING the market 10 years ago, Pepper Money has aimed to help more Australian families reach their homeownership goals. The company’s goal has always been to work closely with people whose circumstances aren’t catered for by the major players in the industry – and for Di Robinson, head of north west retail sales at Pepper Money, that mission statement remains unchanged in 2021. “I think there’s always going to be a need for lenders who can think outside the box and use non-traditional means to provide solutions for brokers and clients alike,” Robinson says. “There’s a significant group of Australians who are underserved by mainstream lenders, and that’s where we step in.” Over the last few years in particular, Robinson has seen a growing awareness of the importance of non-bank lenders. “There’s been a shift in the market – customers that used to be considered ‘prime’ are now often falling outside of prime criteria,” Robinson explains. “One example that we see is investors with larger portfolios. While making repayments
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is well within their capabilities, mainstream lenders are often tightening their appetite around working with this kind of customer.” Accordingly, more brokers are seeking the assistance of specialist lenders, particularly for their clients who are self-employed or investors, Robinson says. She suggests that refinancing may also lead to using a specialist lender, particularly
if the borrower is looking to consolidate tax or business-related debt into a mortgage. “I think previously there’s been some hesitation around using specialist lenders,” Robinson says. “There’s been a widespread perception that they primarily cater to customers who have credit impairment, which isn’t really the case. Given the way that prime criteria have evolved since the
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GFC, borrowers from all walks of life are looking for new financial solutions.” Robinson points to prospective borrowers who are self-employed as a key example. While tax returns have traditionally been used as a form of income verification, self-employed borrowers often require a lender who will consider alternatives such as BAS statements. “You’ve got a subset of customers who are very successful on their own merits, but they’re shut out of ‘prime’ loans simply because they don’t fit the orthodoxy,” Robinson says. Similarly, the typically faster approval time of specialist lenders can also be a strong selling point for both brokers and
“There’s always going to be a need for lenders who can think outside the box and use non-traditional means to provide solutions” Di Robinson, Pepper Money their clients – banks often have lengthier processes, which can prove problematic when dealing with business deadlines and specific finance clauses. Certainly, there’s also room for borrowers who have previously had a credit incident. After all, as Robinson points out, “Prime is
just a moment in time”, and past negative credit history is not necessarily indicative of future potential – not to mention the ways that borrowing potential can be impacted by simple ignorance. “One thing we often see is prospective borrowers not meeting the criteria for
EMPLOYMENT TAKES A HIT FROM COVID-19 Payroll jobs and wages index, Mar 2020–Jan 2021
Payroll jobs
Total wages
104 102 100 Index
98 96 94 92
14Ma 28 r-20 -M ar11- 20 Ap 25 r-20 -A 09 pr-20 -M 23 ay-2 -M 0 a 06 y-20 -Ju 20 n-20 -Ju 04 n-20 -Ju 18- l-20 Ju 01- l-20 Au 15- g-20 Au 29 g-20 -Au 12- g-20 Se 26 p-20 -Se 10- p-20 Oc 24 t-20 -Oc 07 t-20 -No 21- v-20 N 05 ov-20 -De 19- c-20 De c 02 -20 -Ja 16- n-21 Ja 30 n-21 -Ja n-2 1
90
Week ending Source: ABS Weekly Payroll Jobs and Wages in Australia, January 2021
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FEATURES
SPECIALIST LENDING
lenders mortgage insurance because they’ve had multiple enquiries on their credit file recently,” Robinson says. “For example, they might have been shopping around with multiple lenders for a car loan in the last 12 months or so. Many people don’t realise that exploring finance options with many different providers will impact their credit score.” All these and other factors are likely to have a longer-term impact on the lending industry, particularly in the wake of COVID-19. People have had their longterm employment interrupted, their income reduced and their savings patterns disrupted. While Robinson believes the full effects of COVID-19’s impact are still to be realised, she thinks it’s clear that customers who have never had to consider a specialist loan in the past may have to do so in the future. “The great news is that this provides brokers across Australia with new opportunities to connect with more customers and assist them with their lending needs,” she says. “I think we’ll see even more of this in 2021 as customers will be looking to brokers for guidance and support as they navigate through a different, and sometimes difficult, landscape. Brokers are uniquely placed to offer the broadest range of product options that a customer may need to find a solution.” Clearly, Robinson notes, it’s of key benefit for brokers who haven’t previously worked with non-bank lenders to start now. To this end, Pepper Money offers an online Product Selector Tool that can provide brokers with an indicative offer in under five minutes, which helps provide options to clients in the moment, as the broker requires. Additionally, Pepper Money also has BDMs and a scenario team who are able to discuss any queries either over the phone or via email. “Brokers have the opportunity to showcase their expertise to their customers like
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“Borrowers need to have confidence that you’re doing the right thing by them, and good communication is a key part of that process” Di Robinson, Pepper Money never before,” Robinson says. “We’re going to see even more customers looking to brokers for guidance and support as they navigate through different and sometimes difficult situations.” That’s not to say it’s always easy, of course. The challenge for brokers, she says, can arise from recommending a near prime product to the client when they may have never needed to consider an alternative lender in the past. It’s not a purely financial consideration; for many borrowers, there’s a psychological component too. “At Pepper, we have a 5 Step Process,” Robinson says. “Brokers can use this as a guide on how to successfully offer an alternative lending solution, as well as to get some tips on navigating the emotional aspect of the customer’s lending experience. Borrowers need to have confidence that you’re doing the right thing by them, and good communication is a key part of that process.” Robinson believes brokers are uniquely placed to access a range of different product options that can help a customer in every situation, whether they need a quick response to a loan enquiry or a lender that
will help them work through a life event that has led to some credit impairment. “The value proposition of a broker has never been more relevant,” Robinson says. “Being able to commit to the customer to see them through the loan journey from start to completion is a critical benefit for many borrowers.” Looking ahead into 2021 and beyond, Robinson is convinced that specialist lending will continue to provide solutions for borrowers who don’t meet the mainstream lending criteria and require a lender that will consider their individual circumstances. Specialist lending has also become more relevant after customers’ experiences, both emotional and financial, of the unprecedented events of the last year. “For many it was a very rewarding year financially, but many other customers and businesses were challenged by the events,” Robinson says. “As we navigate through this year, a lender that can support self-employed customers by considering their current income and situation will be important to helping those businesses continue moving forward.”
ABOUT PEPPER MONEY As Australia’s number one alternative lender, we live our mission: to help your clients succeed. Our goal is to provide you with first-class service and innovative products to help you deliver solutions to your clients who don’t tick all the traditional boxes, for home loans, car loans, commercial loans, loans for professional equipment and personal loans.
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FEATURES
DECISION-MAKING
Six ways to simplify tough decisions You can get better at making decisions – even the really difficult ones. Aytekin Tank outlines six science-based techniques that can help put your internal tug-of-war to rest
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THE TYPICAL adult makes 35,000 decisions each day. If you do the math (and account for seven hours of sleep), that’s about 2,000 decisions every hour – or one choice every two seconds. Most decisions are actually micro choices, like clicking a link or taking a sip of coffee. But some choices feel momentous. An internal tug-of-war indicates that something big is at stake. You sense that the choice could significantly affect your happiness, freedom, pride or personal fulfilment. If you’re running a business, there are even more decisions to make – and many are critical to the health of your company. The good news? Science is continually discovering new and better ways to make tough decisions. As Lea Heinrich wrote in the New York Times, “over the past few decades, a growing multidisciplinary field of research – spanning areas as diverse as cognitive science, management theory and literary studies – [has] given us a set of tools that we can use to make better choices”. Unfortunately, none of these tools can actually make the decision for you. “They are prompts, hacks, nudges,” Heinrich says. “They’re intended to help you see the current situation from new perspectives, to imagine new possibilities, to weigh your options with more sophistication. There is no foolproof algorithm for life’s difficult choices. But the research shows that you can get better at making them.” Since I started JotForm, my team and I have faced a lot of tricky choices, and I’ve tried many different decision-making techniques. Here are six methods that I rely on when I’m losing sleep over a challenging decision.
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Make a value-based pros and cons list
Imagine that you’re considering relocating to a new city. Pull out a piece of paper and write a classic pros and cons
list for the move. Now, here’s where science has added a helpful twist. Assign every list entry a number from 0 to 1, based on your personal values. For example, if being closer to your family is a pro that’s extremely high on your list, you might score it at 0.9 or 0.95. If you listed ‘near the mountains’ as another pro, but you’re more of a culture hound than an alpine
the “pre-mortem”. In the Harvard Business Review, Klein explained why a pre-mortem is the hypothetical opposite of a post-mortem. “A post-mortem in a medical setting allows health professionals and the family to learn what caused a patient’s death. Everyone benefits – except, of course, the patient. A pre-mortem in a business setting comes at the beginning of a project rather than
It’s easy to see the world in black and white, but there’s typically a grey option in the middle – or several shades of grey hiker, then it might only rate 0.2 or 0.3. Do the same for the con side. Leaving a job you love could score 0.8, for example, if your career is an essential part of your life. Add up each side, multiply by 100, and see whether the pro or con side wins out. You can also make a separate pro and con list for staying where you are. Compare the final values and see how you feel about the outcome. Often, confronting a ‘logical’ number (which is actually weighted with emotions) can illuminate subconscious feelings. If you see the numbers but still feel pulled in the opposite direction, it’s worth doing some deeper exploration. You can also use this technique for smaller, less personal decisions, like which project or feature to tackle next.
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Explore future scenarios
Considering the best- and worstcase scenarios is a common way to make tough choices. What’s the very best future you can imagine? The worst? How would you feel if that disastrous scenario became reality? To expand on this technique, psychologist Gary Klein has studied a twist he calls
the end so that the project can be improved rather than autopsied.” Imagine that your decision was terrible. The project you chose to tackle was a crashand-burn disaster. Now, explore every possible reason for the failure. Once you address this worst-case scenario, you can take steps to prevent it – and make a better decision in the first place. In fact, research shows that pre-mortems (which are also called prospective hindsight) can increase our ability to identify future outcome causes by 30%. On the flip side, try to visualise that epic, best-case future scenario and gauge how you feel. If you’re not happy or excited, it’s worth considering why. Amazon uses a variation of both these techniques. Company developers must draft a hypothetical press release and FAQ announcement before they even write any code. By working backwards, the team tackles the most difficult decisions upfront and clarifies the product’s value proposition. As reporter Jillian D’Onfro explains, “if the team can’t come up with a compelling press release, the product probably isn’t worth making”.
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FEATURES
DECISION-MAKING
3
Avoid binary choices
We often get stuck choosing between this or that. Should I go back to school or start a business? Should I move to San Francisco or stay in Houston? It’s easy to see the world in black and white, but there’s typically a grey option in the middle – or several shades of grey. Maybe you could spend summers in San Francisco and winters in Houston. Or you could live
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Give yourself enough time
I still remember the day I quit my job. As I climbed the two flights of stairs to my boss’s office, my heart was thumping in my chest. My legs were shaking, and my mouth was parched. I knew it was the right choice, but my mind raced: “Am I making a mistake? Should I turn around? Maybe I should stay another year.”
Our 35,000 daily choices can be daunting, but quick action is the enemy of decision fatigue. Choose fast and, whenever possible, tackle your choices head-on ... Just don’t follow the herd in Houston for another couple of years and move to the Bay Area later. Sometimes the right choice is not one of two opposites – it’s a more creative, nuanced or flexible solution.
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Consult with others
Sharing your dilemma with others can justify or reinforce a choice, but, more importantly, it’s a valuable way to gather important information. If you can’t decide whether to move, for example, don’t just survey your friends and family (who will also have skin in the game); talk to someone who made the same move. Ask how they feel now about their decision. If you need help to make professional or business decisions, try hiring a consultant. Find people who have deep, niche expertise and learn as much from them as you can. The extra information you gather will almost inevitably help you make better choices in the future.
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But I made it to his office and had the conversation I was dreading. I had been thinking about this leap for at least two years, and my side products were easily paying the bills. Taking time to choose empowered me to make one of the best decisions of my life.
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Avoid hidden decisions
For nearly 6,000 years, North America’s First Nations hunted the plains buffalo by chasing them over cliffs and finishing the kill below. This method enabled tribes to gather and store large quantities of meat, hide and fat for the long winter ahead. I always wondered why so many bison would just run over the cliff. They were usually pursued by hunters on horseback, for one, but it’s also an example of herd behaviour. All of the animals are just following the group, letting the flow take them where it will.
Buffalo jumps are a good metaphor for hidden decisions or non-decisions, which we’ve all experienced at times. When you procrastinate or delay an important choice, you’re still making a decision – and it’s rarely a good one. For example, maybe you need to part ways with an employee, but you put it off to avoid a potential confrontation. If the employee is negative, unpleasant or ill-suited to their role, the choice to wait and delay can poison the whole team. Non-decision is a choice with real consequences. Our 35,000 daily choices can be daunting, but quick action is the enemy of decision fatigue. Choose fast and, whenever possible, tackle your choices head-on. Use as many methods as you need to pick the best solution. Just don’t follow the herd. Choose what’s best for you – and then stand firm in your decisions. If you’ve started a business or launched a product and you’re feeling overwhelmed by all of the decisions, please know that it does get easier. Once your business is stable, many of the big, foundational choices are done, and you will reach equilibrium. Then it’s time to focus on the constraints. Determine where you can make the most important, impactful decisions, and use them to grow or refine your business. Remember, decision-making gets easier with practice, and a new choice is always just seconds away.
H w
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Aytekin Tank is the founder and CEO of JotForm, an online form creation software with eight million users worldwide. A developer by trade but writer by heart, Tank shares stories about how he exponentially grew his company without receiving any outside funding. For more information, visit jotform.com.
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MPA -Full Page (w) 210mm x (h) 268mm
Justin, surfing pro
Mark, lawn bowls enthusiast
Fernanda, loves regional Victoria
A network that celebrates you
Alan, motorbike fanatic
Sarah, women’s advocate
With LNS you get the best of both worlds: The support of a team and the freedom to build your own business. We celebrate you as an individual, while offering the benefits of a strong and vibrant community.
Helping people is not just a 9-5 job for Maria Finneran. While by day her passion is to help homebuyers find the finance solution to suit their needs, out of hours, one of her many activities is volunteering with St Vincent de Paul helping the homeless. It’s with this compassion and empathy that Maria helps customers get financial and into a new home, whatever their circumstances. Thank you, Maria.
...PS, and when I’m not helping you build your business; you’ll find me on the bike. - Brendan O’Donnell Managing Director, Liberty Network Services
Maria, volunteer
To find out more about becoming a Liberty Adviser, visit liberty.com.au/LNS.
Dino, Italian food lover
“
Home loan specialist with heart.
We’re more than just an aggregator, because you’re more than just a mortgage broker.
Masih, Persian BBQ connoisseur
Inspiring borrowers and footballers alike. Whether it’s securing a loan or securing a win on the football field – as a broker and coach, Brett Foster knows the importance of having a strategy in place to achieve one’s goals. Waking before 5am to carry out his own fitness regime each day, Brett brings the same discipline and determination to his work - staying sharp to help more people get financial. We reckon that makes you best on ground, Brett. Brett, coach
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FEATURES
MANAGEMENT
Adapting leadership to a post-pandemic workforce Since the social restrictions introduced in 2020 forced much of the Australian workforce to work from home, employers have been preparing for what the workplace will look like moving forward. Michelle Gibbings offers some tips for leading in the new working world
WITH COVID-19 has come challenge and opportunity for workplaces. As you look to the future as a business leader, what do you want to leave behind and carry forward in terms of how you work? Answering this question is important on two fronts. Firstly, it’s too soon to go back to pre-pandemic ways of working, and secondly, COVID has accelerated workplace change, with much of it here to stay. Deciding how to go forward starts with identifying what’s working for you, your team and your organisation. Think about what you have enjoyed, the benefits you have gained, and why you want them to continue. Write these down and reflect on why they matter. Next, look at what hasn’t worked and why. Identifying the root cause is important to determine if that new way of working should be disbanded or just needs to be
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tweaked. It can be helpful to invite your team members to participate in this review so you get their perspective on the workplace. Doing this also helps build their buy-in and commitment to future change.
the office banter and casual conversations. These impacts translate into variations in productivity and engagement. Consequently, it’s essential to recognise each team member’s needs and understand what they require to be at their best at work.
Recognise different needs As part of this process, recognise that the level of adjustment and adaptation required across workplaces has and will continue to be mixed. For some employees, the rapid move to working from home has been successful, meaning less commuting, a better work-life balance and access to effective technology to support productivity. For others, it has been stressful as they juggle homeschooling or have no defined workspace or the technology they need to work effectively. Added to that, people who draw energy from connecting with their colleagues are missing
Create choice Many organisations are now using the term ‘work from anywhere’, signifying that the traditional model of sourcing employees who are willing to be locally based or to travel frequently has shifted. This opens organisations to a broader talent pool. For employees, it also means they are no longer geographically hamstrung when it comes to applying for overseas roles. Also, some people are keen to get back to the office and others less so. Examine your workforce and roles to determine the options and flexibility that can continue.
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It’s essential to recognise each team member’s needs and understand what they require to be at their best at work Know when virtual doesn’t work
Step up and lead
Working from home is here to stay, but connection and time spent with team members and colleagues will always be necessary. Humans are tribal creatures who are hardwired for connection. Part of the joy and happiness that people experience at work comes from the banter and chats they have with their colleagues. Nothing can replace the casual corridor conversation or chat in the tea room. Recognise that not everything can be done remotely (or done as effectively remotely). Leaders will want to consider where face-toface sessions are more productive and effective, and where remote will work just as well.
Leadership matters, whatever the working environment – be it the office or home. The best leaders appreciate this and are shifting and elevating their leadership style to suit these new circumstances. They understand that in times of challenge and uncertainty they need to provide more, not less leadership. People want to feel they matter and know they are valued. Leaders should continue to set regular times to check in with their teams. These check-ins aren’t just about how tasks are progressing; they’re about finding out how the team member is doing in terms of emotional and mental health too.
Support healthy practices Central to creating a healthy environment is the relationship a leader has with their team members. Successful relationships are underpinned by psychological safety. This is an environment in which people are comfortable to share what is or isn’t working for them and how they are feeling, and to be their authentic selves. It helps if leaders role-model self-care behaviours. Encourage your team to take care of their physical and mental health. Suggest they take regular breaks; notice and manage workplace stress; and have a safe space where they can talk about their mental health and wellbeing. Michelle Gibbings is a workplace expert. She is the author of Step Up: How to Build Your Influence at Work; Career Leap: How to Reinvent and Liberate your Career; and the new book Bad Boss: What to Do if You Work for One, Manage One or Are One.
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PEOPLE
BROKERAGE INSIGHT
Small firm making a big difference TAG Financial Group’s co-founder and director Andrew Browne talks to MPA about the journey the brokerage has taken, and how it has adapted to new ways of doing things over its 15 years in business WHEN TAG FINANCIAL GROUP was founded in 2006, it was with the goal of becoming a ‘one-stop shop’ for all the financial needs of its customers. This was further solidified the following year when TAG Wealth Solutions began operations. The brokerage offers a combination of expertise in finance and financial planning, providing a tailored experience to each individual client and focusing on longer-term strategies to ensure investment growth and financial stability. The three founders of TAG had varying levels of experience when they started the business. Tony Herbert had been in financial services for 25 years, with two in broking, Andrew Browne had been in the industry for three years, and Glen Austen was at the very beginning of his successful finance career. “Our goal is to provide consistent high-level service to our clients, ensuring that they have peace of mind that all their financial matters are well managed,” says Browne. Browne joined the broking industry in 2003 after seven years in advertising and marketing. When he first experienced the services of a finance broker while going through the process of buying a home, he says his “passion for the industry was immediate”. “I thought a business in the emerging finance broking industry could benefit from my existing
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skill set – all I needed to do was learn the job,” Browne says. He started by undertaking a two-and-ahalf-year mentorship in a busy Perth mortgage broking office, where he says there was no shortage of leads in what was then a hot market. Fifteen years on, the WA market has been through more highs and some lows too. But Browne says that true to its ‘boom and bust’ reputation, the broking industry has ridden those ups and downs. Recently, the WA property market has been a little flat, and the brokerage has had to pivot to remain relevant. Browne says that rather than buying new homes, people are instead looking to renovate and buy things
like new pools. While they had not written personal loans before, TAG’s brokers adapted to keep up with their clients’ needs. A lot of the work done over the past year was also around maintenance and being there for clients who were genuinely concerned. Things are starting to change, though. “Thankfully, right now all signs are that we are starting to feel a real swell in the market, and fingers crossed the waves start to role in and we can enjoy a prosperous five years ahead,” he says. As Browne and the team look ahead to the next 12 to 18 months, he says diversification and a more digital approach are “without a doubt” the business’s key focuses.
GIVING BACK TO MOVE FORWARD TAG Financial Group has been built around the philosophy that in order to move forward in business, you need to give back. This vision is something it takes very seriously, says co-founder and director Andrew Browne. Through that vision it has been able to make a difference to the lives of communities both in Australia and abroad. Since 2015, TAG has raised more than $250,000 for charity. In 2020, the team raised more than $111,000 in just a few hours at the group’s 12th annual TAG 1% lunch. The money was donated to support Heart Kids WA and Nakuru Hope Kenya. “We ‘give back’ through our programs because we want to make a meaningful difference to our local community and to those who are less fortunate than ourselves all around the world,” says Browne. “Despite being a small firm, we believe we can make a big difference.”
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TAG FINANCIAL GROUP AT A GLANCE Founders: Tony Herbert, Glen Austen and Andrew Browne Location: Western Australia Year founded: 2006 Services offered: Home loans, business loans, personal loans, financial planning Number of employees: 15 Awards: WA Finance Broker Business Award 2020, MFAA Excellence Awards; WA Diversified Business Award 2019, MFAA Excellence Awards; WA Mortgage Brokerage of the Year 2018, Connective Excellence Awards
“Our goal is to provide consistent high-level service to our clients, ensuring that they have peace of mind” Even before COVID-19, TAG had tried to engage with customers over Zoom, but it was not until 2020 when people were forced to adopt online processes that it really took off. Browne says even the more traditional brokers have moved to virtual calls, and the group has seen a growth in consumer confidence and broker efficiency. Beyond the digital, 2020 saw many other changes, such as to lender policy and regula-
tions. Despite working remotely, the team at TAG stayed in touch and up to date with regular training sessions twice a month. “It was interesting trying to keep the sessions exciting, but we used a couple of platforms where we’d have personalities dial in so we could get everyone engaged in the call,” Browne explains. The team would be joined by AFL stars and other sports personalities who would be
briefed on what the session was about so they could come in and talk about how it tied into their fields – whether it involved adapting to new regulations or working in a new way. Browne commends the team at TAG for adapting in such a positive manner, particularly with the increased levels of work and having to learn to do things differently. Despite the challenges, the TAG Financial team continue to work towards the group’s purpose, which Browne says centres on trust – earned through honesty, transparency, and respect; accountability – in owning and valuing one’s responsibilities; and greatness – what the team strive for, for their clients and themselves, by living their values and delivering their purpose.
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PEOPLE
OTHER LIFE
TELL US WHAT YOU GET UP TO Email rebecca.pike@keymedia.com
“ My fa mily all do acro, so I just like to ha ng out with the m”
6.5m
Height of Zain Peart's aerial rig
10
Age at which Peart began surfing
4
Number of years he has been doing flying trapeze
EVER THE RISK-TAKER Mortgage broker Zain Peart spends his free time in extreme ways WHEN MORTGAGE broker Zain Peart isn’t writing home loans, he’s flying through the air, diving below the ocean and falling off skateboards. The founder of ZEP Finance is a big fan of extreme sports and acrobatics, and even has his own aerial rig set up at home for himself and his family. When he was as young as five years old, Peart began body boarding, and then at 10 he started surfing. He also
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skates, does flying trapeze every week, snorkels and scuba dives. Having experienced sky diving as well, he is keen to get back up there and do it again. Peart says surfing is an activity he particularly enjoys and one that has taken him to many countries. “Surfing is always great because you sit out the back on your board and everything that is going on in life just melts away. It’s a really good way to
relax and clear your mind,” he says. Peart recalls the time he and his family went snorkelling in Thailand when one of his daughters was just three or four years old. “We saw a little pack of sharks and went swimming after them for a while. She was really excited and pointing at them,” he says. It appears his daredevil nature also runs in the family.
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MPA-FP
land, construction & residual stock lending experts. melbourne sydney brisbane level 1, 1121 high street, armadale. victoria 3143 telephone: (03) 8691 4190 email: info@supracapital.com.au Supra Capital Ltd. acn 112 331 361 | holder of australian financial services licence no. 305570
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We’re not saying brokers love us. Let’s just say, it’s a strong like. We’re pretty chuffed that for the second year running, we’ve been awarded ‘Bank of the Year’ by brokers at MPA’s Brokers on Banks survey! Thank you to the thousands of brokers who trust us each year with their customers’ home loans and who motivate us to deliver better home loan experiences every day. Keen to find out about our award-winning BDM support, training and interest rates? You might find there’s a lot to like. bankwest.com.au/brokers
bank less Bankwest, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL/Australian credit licence 234945.
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8/03/2021 11:56:47 AM