Mortgage Professional Australia 22.01

CUSTOMER-OWNED BANKS ROUNDTABLE Mutuals thrive on the back of the property boom, broker partnerships

MPAMAGAZINE.COM.AU ISSUE 22.01

SPECIALIST LENDING The opportunities for customers who don’t fit the vanilla profile RISING STARS Revealing the top 25 young brokers for 2022

BROKERS ON BANKS 2022 How Macquarie’s hard work and dedication earned its team the top bank award Wendy Brown Macquarie Bank

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09/03/2022 10:18:47 am

ANZ & BROKERS

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ANZ Brokers * This LVR is for medical practitioners, specialists and dental practitioners who are existing ANZ lending customers (that have held an ANZ lending product for at least 6 months) with an owner occupier loan making principal and interest repayments. For other eligible customers, the LVR is up to 90%. Different LVRs may apply to other lending options, such as investment lending.

Terms, conditions, fees, charges, and credit approvals and eligibility criteria apply to ANZ home loans. Please visit anz.com.au/promo/broker for the offer terms and conditions, including how to verify customers’ qualification/registration. © Australia and New Zealand Banking Group Limited (ANZ) 2020. ABN 11 005 357 522. Australian credit licence number 234527. Item No. 97528C 08.2021 WX248035

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MARCH 2022

CONNECT WITH US

CONTENTS

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

UPFRONT 02 Editorial

29 FEATURES

13 FEATURES

BROKERS ON BANKS 2022

Banks swap places in this year’s top ranking as brokers rate them on turnaround times, product range, BDM support and more in MPA’s annual survey

CUSTOMEROWNED BANKS ROUNDTABLE

Six mutuals and two brokers gather to discuss the growing success of customer-owned banks

46

Specialist Finance Group’s managing director talks about the strengths of the aggregator’s business model that are driving growth for brokers

04 Statistics

Housing market starts the year strong

06 News analysis

Now is the time to prepare clients for rate rises

08 Opinion

The importance of planning ahead for broking success

FEATURES 56 Mortgage franchises

The broking franchisers joining forces to build a powerful network

66 Company values

How having a higher purpose can drive profit for a business

PEOPLE

BIG INTERVIEW

WILLIAM LOCKETT

Confidence is rising as the pandemic’s shadow lifts

FEATURES

SPECIALIST LENDING

The non-banks are winning market share with solutions for borrowers who don’t fit the vanilla profile

26 Expert spotlight

Head of broker sales Wendy Brown explains how Macquarie has excelled in five key areas to win brokers’ votes

70 Brokerage insight

Orium Finance co-founder Luke Heavey believes in the value of personal service

72 Other life

Broker Katrina Rowlands' true love is caring for micro donkeys and peafowls

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61

SPECIAL REPORT

2022 RISING STARS

The top 25 young brokers who have made the biggest impact on the industry this year

MPAMAGAZINE.COM.AU NOW ONLINE: Our daily newsletter. Keep on top of property market trends, business strategy, and what industry leaders have to say.

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09/03/2022 11:35:56 am

UPFRONT

EDITOR’S LETTER

Hope for brighter days ahead

I

t’s hard to believe it’s already 2022 and after two long years the nation is finally emerging from the shadow of the pandemic.

We are finally leaving COVID-19 behind and some positive developments for lenders and brokers have emerged.

These include a booming property market, with property prices across Australia rising by around 22% last year. There has also been unprecedented home loan growth, with mortgage brokers settling 66.5% of all new residential home loans in the December 2021 quarter.

What’s even more impressive is the value of these home loans, with brokers settling $96.65bn in mortgages in the December 2021 quarter, according to the MFAA and Comparator. This is the highest-ever quarterly figure and an almost 50% increase on the $64.10bn settled in the December 2020 quarter.

Regional areas have thrived as people realise they don’t have to live in Sydney or Melbourne to maintain their careers. Lockdowns have been lifted, pandemic restrictions are easing, and there are signs that our major cities are starting to hum again with people heading back to the office for at least part of the working week.

There’s even been an uptick in businesses seeking finance to expand and build

There has been unprecedented home loan growth, with brokers settling 66.5% of all new residential home loans in the December 2021 quarter warehouses and buy equipment. Business confidence is rising, and people are keen to return to face-to-face events.

As this issue’s industry roundtable (p29) reveals, customer-owned banks are thriving. Through their close partnerships with the third party channel, along with business mergers and the introduction of new technology, the mutuals are competing well and carving out a successful place in the sector.

Specialist lenders are also making the most of a buoyant market. They are capitalising on their unique value proposition in the near prime space and offering diverse solutions for brokers and their clients who don’t fit the vanilla customer profile favoured by the big banks.

Our Rising Stars special report (p61) celebrates brokers aged 35 and under who are excelling early in their careers. It’s interesting to read about their fresh approach.

Looking ahead, there are still some grey clouds on the horizon for the industry, including rising interest rates and higher inflation. But we are in a far better position than we were at the peak of the pandemic, and I’m confident about the future.

Here’s to a better and brighter 2022.

Antony Field, editor, MPA

www.mpamagazine.com.au MARCH 2022 EDITORIAL

SALES & MARKETING

Editor Antony Field

Publisher Claire Tan

Contributors Carolyn Butler-Madden, Joseph Khal

CORPORATE

Production Editor Roslyn Meredith

Chief Executive Officer Mike Shipley

ART & PRODUCTION

Chief Operating Officer George Walmsley

Designers Loiza Razon, Khaye Cortez, Cess Rodriguez Customer Success Manager Andi Zbojniewicz

Managing Director Justin Kennedy Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil

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Mortgage Professional Australia is part of an international family of B2B publications and websites for the mortgage industry AUSTRALIAN BROKER

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Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as the magazine can accept no responsibility for loss.

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09/03/2022 1:03:38 pm

Switching aggregators to Specialist Finance Group means I now have access to the best software in the industry.

Louisa Sanghera ZIPPY FINANCIAL

1300 303 382 specialistfinancegroup.com.au Australian Credit Licence No. 387025

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09/03/2022 12:49:49 pm

UPFRONT

STATISTICS

Housing year starts strong

Softer growth and a brief surge in demand for regional property is predicted for 2022 AUSTRALIA’S HOUSING market started strong in 2022 with a surge in auction activity, an uptick in dwelling values, plus an increase in buyer demand despite the threat of Omicron, affordability constraints and tightening credit conditions.

However, softer growth outcomes are predicted for 2022, according to CoreLogic’s Best of the Best 2021 report, possibly along with a drop in purchases “where sales and listings activity eventually move with

$2m

$1.5m

momentum in price”. There may also be a decline in vendor activity due to lower growth rates and the chance of a drop in dwelling values over the next few years.

Also predicted is higher demand for regional property in the early months of 2022, similar to the surge that followed the 2020 lockdowns, as relaxed border restrictions make physical inspection and purchase of properties easier for those who have come out of lockdown across Sydney, Melbourne and the ACT.

6.5% QOQ 25.2% YOY

$1m

$500k

0

13.7%

36.9%

of Aussies say they are doing great financially

say they are getting by

28.3%

NATIONAL

21.0%

say they are just coping

say they are having trouble

Source: CommBank & Melbourne Institute Australian Future Financial Wellbeing Report, quarterly update Dec 2021

RENTAL PRICES SOAR National rental prices rose 7.4% in 2021, taking average rents to $499 in December 2021, compared to $465 one year prior.

WEEKLY ASKING RENTS FOR HOUSES, DEC 2020–DEC 2021

Capital city

Dec 2020

Sept 2021

Dec 2021

QOQ

YOY

Sydney

$550

$580

$600

3.4%

9.1%

Melbourne

$440

$430

$445

3.5%

1.1%

Brisbane

$425

$460

$480

4.3%

12.9%

Adelaide

$410

$440

$450

2.3%

9.8%

Perth

$415

$450

$460

2.2%

10.8%

Canberra

$600

$645

$675

4.7%

12.5%

Darwin

$550

$620

$600

-3.2%

9.1%

Hobart

$460

$495

$500

1.0%

8.7%

Combined capitals

$465

$483

$499

3.4%

7.4% Source: Domain December 2021 Rental Report

4

PROPERTY SETTLEMENTS UP The total aggregate value of property sale settlements nationally grew a massive 57.3% to $688.7bn in 2021, driven by rises in the volume and value of settlements.

$688.7bn

$437.7bn $390.8bn

2019

2020

+12.0%

2021

+57.3%

GROWTH IN SETTLEMENTS Source: PEXA Property and Mortgage Insights Report

www.mpamagazine.com.au

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09/03/2022 11:42:26 am

HOUSE PRICES AT RECORD-BREAKING HIGHS 6.0% 33.1%

Australia’s median house price has breached $1m, with the combined median house price across the country’s capital cities now at a record-breaking $1,066,133. Sydney posted the steepest annual increase on record: a price rise of nearly $400,000 over the 2021 calendar year.

YOY QOQ

5.8% 18.6%

11.3% YOY 36.6% QOQ

YOY QOQ 10.7% 25.7%

SYDNEY

MELBOURNE

YOY QOQ

BRISBANE

December 2021

8.6% YOY 27.5% QOQ

ADELAIDE

1.8% 7.5%

CANBERRA

September 2021

YOY QOQ

PERTH

8.7% 34.6%

YOY QOQ

0.0% 30.1%

HOBART

YOY QOQ

DARWIN

December 2020

Source: Domain House Price Report, Dec 2021

WHAT AUSSIES CONSIDER WHEN BUYING A HOME

MORE AUCTION ACTION

Housing affordability has changed markedly during the pandemic. This, in turn, has affected what Australians see as important when buying a home.

The final quarter of 2021 saw a surge in the number of auctions alongside lower clearance rates, implying that demand wasn’t keeping pace with supply.

FACTORS AUSSIES CONSIDER WHEN DECIDING TO PURCHASE A PROPERTY

62%

Good local shopping, restaurants & other amenities Size of the land Size of the house/apartment Good public transport

26% 26% 21%

Buying in a metro area Having a study/work area Buying in a regional area Other

Capital city Perth Tasmania Adelaide Brisbane Sydney Canberra Melbourne National

53% 50% 52% 50% 41%

House instead of apartment

Apartment instead of a house

CAPITAL CITY AUCTION CLEARANCE RATES AND VOLUMES, Q4 2021

74%

Amount they are prepared to borrow to buy

8% 5% 11% Source: NAB News

Clearance rate

Auction volumes

55.6% 63.2% 80.5% 74.9% 69.9% 82.4% 69.7% 71.3%

308 38 2,902 3,027 14,906 1,949 19,788 42,918 Source: CoreLogic

www.mpamagazine.com.au

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09/03/2022 11:42:38 am

UPFRONT

NEWS ANALYSIS

Get ready for rate rises The possibility of interest rate rises looms large over the Australian economy, prompting lenders and brokers to get in early and talk to clients IT’S THE multibillion-dollar question on everyone’s lips: just when will the Reserve Bank of Australia lift interest rates?

RBA governor Philip Lowe has kept everyone guessing by saying the bank could raise the official cash rate in 2024, or even next year. However, last month he told a parliamentary committee, “We’re looking at the evidence and data, and it’s plausible that rates could go up some time this year.”

What then are the implications for brokers

through changing economic and broader market forces.”

Gibson says that if the past two years have taught us anything, it’s that you can never truly know how homebuyers and sellers are going to act.

“Many brokers have a regular pattern of communication they maintain with their clients, but with so much talk of interest rate movements, now could be a good time for brokers to be reaching out to their clients to

“With so much talk of interest rate movements, now could be a good time for brokers to be reaching out to their clients to see how they’re feeling” Glenn Gibson, ING and lenders? MPA asked Mark Haron, director of Connective, and Glenn Gibson, head of customer experience, service and distribution at ING Australia.

“There is no certainty around when interest rates will begin to rise again, but it’s safe to expect change in the short term because banks can, and do, move on rates outside of RBA decisions,” Haron says.

“The governor has made it very clear that the RBA will not increase the cash rate until inflation is sustainably within the 2–3% range.

“At Connective, we’ll continue to listen to and work with economists and ensure our brokers are well informed and prepared to support their clients and their businesses

6

see how they’re feeling,” he says.

Some clients may be feeling anxious about a rate increase and what this could mean for them. Gibson says brokers should consider discussing with their clients: •

•

•

whether their financial situation has changed and if their loan is still the right one whether they are financially prepared for an interest rate increase and, if not, is there anything that can be done to change this whether they can make further savings by switching loans

As part of this conversation, they should check that their clients are generally OK, because an empathetic ear can make a big difference.

Connective’s advice to brokers is to maximise this time to deepen relationships with clients.

“Brokers have increasingly become trusted advisers for Australians; now is the time to lean into this,” Haron says.

“Brokers should be proactively connecting with clients and reviewing their rates and broader financial situation. We know borrowers value having loan options explained, getting accurate information and having their needs understood.”

Connective research in 2021 confirmed that speed and interest rates are always important, but brokers who spend more time listening to clients and explaining options are differentiating themselves, Haron says.

“Brokers that can deepen relationships with clients and do [that] at scale with the right technology will be the most successful.”

www.mpamagazine.com.au

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09/03/2022 11:40:38 am

CPI INCREASES BY CAPITAL CITY, DEC 2021 % change in CPI from previous quarter

Sydney

1.2

Melbourne

1.1

Brisbane

1.6

Adelaide

1.5

Perth

1.4

Hobart

2.2

Darwin

0.8

Canberra

“Brokers should be proactively connecting with clients and reviewing their rates and broader financial situation.

We know borrowers value having loan options explained” Mark Haron, Connective So, what should brokers be telling their clients regarding fixed or variable rates?

Gibson says that when selecting a loan a customer should always consider what’s right for them and their ongoing ability to make repayments.

“The talk of interest rate changes may prompt customers to assess their current loan arrangements. Some may choose to switch to a completely new loan or split their loan, part variable part fixed.”

Haron adds that brokers should be working with clients to conduct home loan health

checks to ensure their clients are on the most competitive rates.

“We’ve definitely seen an increase in fixed rate loans in the last six months, but the majority remain split. We encourage brokers to proactively connect with their clients to review.”

In 2021, property prices rose a recordbreaking 21.9%. Some buyers have taken on a high level of debt, putting them at risk when rates rise.

Gibson says that if customers are worried about their ability to make repayments, they should reach out to their broker or

1

Weighted average of 8 capital cities

1.3

Source: ABS, December 2021

bank and update them.

“More often than not, small changes can be made to help you through difficult times; for example, switching loans or adjusting your outgoings. If you’re experiencing hardship, your bank should be doing everything within its power to help you get back on your feet.”

Supporting clients through the life cycle of their loans can strengthen relationships with them and create opportunities for brokers, Haron adds.

“Helping clients to consolidate debt and reduce interest payments will be highly valued,” he says. “On the flip side, brokers could be having conversations with some clients about the potential for new investments.

The opportunity to deepen and strengthen relationships is ripe.”

www.mpamagazine.com.au

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09/03/2022 11:40:49 am

UPFRONT

OPINION

GOT AN OPINION THAT COUNTS? Email antony.field@keymedia.com

Brokers need to plan ahead for prosperity It’s a great time to be a broker, but capitalising on market share requires careful planning, says AFG’s Joseph Khal THERE’S NO denying it; the mortgage industry has evolved. With 67% of all loans originating via brokers and continued bricksand-mortar branch closures, the tide has turned in favour of brokers.

Mortgage brokers have disrupted traditional lending. They now offer the quality service experience of the personal bankers of yesterday. But the next frontier of competition is right around the corner: lenders are building out their direct-digital proposition, and you will see a growing presence in the market sooner rather than later. As brokers look to preserve and grow their market share and distinguish themselves from the sea of competition, now is the time to start the planning cycle. Here are a few tips to get you started.

Plan for the future A great way to approach planning is to break the process down into smaller parts and solve them in stages. I often encourage the brokers I work with to start with the ‘more, better, less’ approach. What can they do more of? What experiences and processes can they make better? And what should they stop doing, change or do less of? This process aims to clarify their high-value and low-value activities.

Once brokers clearly understand their laundry list of high-value and low-value activities, it becomes easier to take an analytical approach to building their longer-term plans.

Clarify your vision When planning for the long term, it often pays to look to the past. Where was your business five years ago? Where have you seen the most significant process improvements? What activities shifted the dial for you? What essential

8

changes did you make over the past five years?

What have been your mistakes?

Taking an honest look at your success and failure is critical to business success. It’s great to be proud of your achievements, but you will limit your growth potential if you gloss over your mistakes.

Set your goals Where do you want to be in the next five years?

What are your personal and professional goals?

Goals will vary from broker to broker.

Some may be looking to grow their businesses; others may be looking at efficiency gains that

Bullet-proof your business Almost every day, you will hear that the Australian property and lending market is not sustainable at these levels. History has taught us that this peak will eventually level out, whether this is three months or three years away. Put the time in now, reap the benefits now, and you’ll also be able to leverage your hard work if a downturn arrives.

Create a rock-solid retention strategy How much do you focus on acquiring versus retaining customers? It’s mainly about acquisition, right? Acquiring new customers is how

It often pays to look to the past. Taking an honest look at your success and failure is critical to business success create more work-life balance. Articulate your goal and start setting a strategy to achieve it.

Hold yourself to account If you have a team, bring them on the journey and empower them to give their points of view.

Diversity of opinions helps challenge your thinking and provides new perspectives and ideas. It’s also a big plus for your team to feel part of the planning process and can dramatically impact the feeling of ownership of your shared goals.

If you don’t have a team, find an accountability partner you can share your goals and aspirations with who will keep you accountable. This could be an industry peer or a partner from your aggregator who understands your business and the industry.

you’ve grown your business. But you need a strategy for both acquisition and retention.

Studies suggest that your retention strategy could net you between five and 25 times the ROI that your acquisition strategy can.

There are a range of retention strategies and initiatives you could be implementing. You could develop a customer feedback loop, maintain a customer communication calendar – whatever you choose, it comes down to analysing the holes in your business strategy and having an action plan to address them.

Joseph Khal is head of broker experience at AFG and has over 14 years’ experience in the finance industry. He supports AFG members in providing the best broker and customer experience.

www.mpamagazine.com.au

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09/03/2022 11:31:37 am

bankaust.com.au/ cleanmoney Bank Australia Limited ABN 21 087 651 607 AFSL/Australian Credit Licence Number 238431.

08-09_Opinion_SUBBED.indd 9

09/03/2022 11:31:51 am

PEOPLE

BIG INTERVIEW

WILLIAM LOCKETT: BUILDING A SUCCESSFUL FUTURE William Lockett, managing director at Specialist Finance Group, has continued to drive growth through challenging times

AFTER 30 YEARS in operation, Specialist Finance Group continues to experience high growth due to its successful and flexible business model and aggregating services.

MPA caught up with SFG managing director William Lockett to learn more.

SFG celebrated its 30th anniversary in 2021 – was this a big achievement for a family-owned aggregator?

A: Celebrating 30 years in aggregation is a significant milestone, as during this journey you need to evolve and adapt to business and industry changes, which I believe SFG has done well.

A large reason for our longevity and business success has been engaging the right people at SFG. Some of these same people are still part of our group and have been for the large majority of our 30-year business history.

We commenced in 1991, and the greatest change has been legislation and licensing requirements, which now see all finance brokers operating under the same regime as opposed to when there were originally no licensing requirements and later when states and territories had different licensing requirements.

10

What has been the biggest challenge for SFG over the past 30 years?

A: The greatest challenge was the original report and outcome of the royal commission of 2019.

This report completely shocked our great industry as it gave no value to the service prop-

how they were solely remunerated for a valued service provided to their clients with full knowledge and consent.

This period was extremely frustrating and worrying for all mortgage brokers and key stakeholders, but through our industry’s outstanding response to the royal commission led by the MFAA and the FBAA,

“We are fortunate that industry-leading brokers have joined SFG, which has seen them substantially grow their businesses with the aggregating services we provide” osition that mortgage brokers carry out for consumers and communities. The report and its findings and recommendations would have had serious consequences for mortgage brokers and their business models.

SFG, as part of the MFAA Aggregators Forum, strongly contributed to this forum’s industry response to the royal commission, engaging key stakeholders such as ASIC, the Treasury and members of parliament. SFG also canvassed MPs directly to educate them on the actual work mortgage brokers do and

common sense prevailed, and the status quo was retained.

What are the key strengths of the SFG business model?

A: We continually strive to provide key strengths in our business model, and we believe we have five key strengths. These begin with great service and a high level of communication from the entire SFG team, which includes myself as the managing director. Mortgage brokers are business

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09/03/2022 11:18:24 am

PROFILE Name: William Lockett Title: Managing director Company: Specialist Finance Group Years in the industry: 31 Career highlight: ”Maintaining and improving our business model over a 30-year period, which has resulted in outstanding growth for SFG” Career lowlight: “Having to deal with the effects of the recommendations of the royal commission and the stress and anxiety this placed not only on our industry but on all of the great people that make our industry so good”

www.mpamagazine.com.au

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09/03/2022 11:18:36 am

PEOPLE

BIG INTERVIEW

owners, and they like to deal directly with me as the business owner of SFG. Technology plays a vital part in our industry. SFG has partnered with Salestrekker to provide its own enterprise version, SFGconnect, delivering what we believe is industry-leading software to SFG members.

We also provide our members with four different commission options, allowing them to select a commission platform that best suits their business model and transfer to a new commission platform as their business changes.

We provide balance sheet finance to our SFG members that allows them to grow their business through extra cash flow funding for

Around 6 a.m., it’s time for my wife, Ann-Maree, and I to have breakfast together as we navigate the day ahead, which includes five beautiful children.

This early start allows me to deal with my most pressing issues in a timely fashion. When I arrive at my office in Subiaco about 8 a.m., I feel as though I’m already on top of my day as it commences.

Being a national company, you have many matters to address and manage across six states and different time zones.

My favourite part of any business day is speaking directly to SFG members.

I generally like to be home by 5:30 p.m., and this is where it’s very much family time,

“We provide our members with four different commission options, allowing them to select a commission platform that best suits their business model and transfer to a new platform as their business changes” business expansion, business acquisition or trail book purchases.

We have a business mantra: “We have a relationship-based approach to doing business, and trust and communication are at the forefront of all of our dealings with both our members and business partners.”

Describe a typical business day leading SFG. A: I’m a very early riser, [getting up at] around 4 a.m. My first appointment is with my British bulldog and black labrador whilst I enjoy my first cup of coffee.

I’m on the tools by 4:30 a.m., which works great for my national business as I’m based in Perth and I can engage with both SFG members and business partners and my eastern states management team.

12

then later on I recap the day and plan for tomorrow.

On weekends I make myself available for business meetings and Zoom calls. Given our primary business partners are mortgage brokers and they work outside business hours, it’s important for an aggregator to be available at these times.

Tell us about SFG’s rapid growth as an aggregator.

A: Our business model has clearly resonated with mortgage brokers, and this has been the prime reason for our outstanding business growth, both among individual brokers and medium and large mortgage broking businesses.

We are fortunate that industry-leading brokers have joined SFG, which has seen

SFG KEY MILESTONES

1991

Specialist Finance Group launched

1995

Singapore office established

2005

Able Finance acquisition

2007

Westland Mortgages acquisition

2016

Southern Cross Broker Network acquisition

2018

SFGconnect software launch

them substantially grow their businesses with the aggregating services we provide.

What are your plans for SFG in the next 12 months?

A: Put simply, our number one goal is to improve our aggregation services. Key projects this year include introducing a new internal CRM platform for our SFG staff and launching a new commission platform hopefully in July that will bring additional benefits to SFG, our members and business partners.

Last year we opened our new SFG Melbourne office, and this year we plan to relocate our Sydney office and make extensive renovations to our head office in Subiaco, Perth. We will also be adding to both our administration and management teams.

www.mpamagazine.com.au

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09/03/2022 11:20:05 am

COVER STORY

BROKERS ON BANKS

BROKERS ON BANKS 2022 Turnaround times have improved, a post-COVID world is in sight, and in-person communication is back. The top two banks have swapped places this year, and one of the big banks has overcome a tough 12 months to grab third place THE BROKER channel is becoming an increasingly important part of the core business of Australia’s banks.

Mortgage brokers wrote 66.5% of all new residential loans last year and are also showing their value proposition in the growing asset finance and commercial sectors.

Faced with a confusing and stressful world of COVID lockdowns and restrictions, and the major economic shockwave that the pandemic brought upon homes and businesses, it was only natural that people turned to brokers when times got tough.

But it wasn’t all about struggle – there were plenty of clients who wanted to make the most of an incredibly low interest rate environment and forced savings to buy

property, refinance and renovate. Brokers were perfectly placed to navigate the myriad of finance options out there and find the best solutions.

The banks that invested in the broker channel by offering speedy loans at the best rates and with the best technology to make the process streamlined and stress-free were rewarded with the top spots in the 2022 Brokers on Banks rankings.

The annual survey asked brokers across Australia to score banks’ performance in the last 12 months across 10 criteria: credit policy; brand trust; communications, training and development; commission structure; diversification opportunities; turnaround times; online platform and services; interest

rates; BDM support; and product range.

While many of the banks that have ranked highly in the past few years are again among the place-getters, some have dropped out of the top three altogether. One of the major banks has leapt into a top spot – a great result given that the big four copped a lot of criticism last year over turnaround times.

There’s a new Broker on Banks winner this year, which shows just how competitive the sector is and how willing banks are to lift their game to attract one of their most important customers – brokers.

Read on to discover which banks were voted the best and for a full analysis of the results. Thanks to all the brokers who took part in this highly valuable survey.

TYPICAL RESPONDENT

Aged between 46 and 55

Writes $20m–$40m worth of mortgages a year

Has been in the industry for over 15 years

Is most likely to work in NSW

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09/03/2022 2:18:08 pm

COVER STORY

BROKERS ON BANKS

PRODUCTS AND PRICING A low interest rate environment has supercharged the number of people seeking to enter the property market or wanting to refinance for a better home loan deal, so it’s little wonder that brokers are looking at banks’ rates and product ranges

NOBODY HAS a crystal ball and can predict just when the Reserve Bank of Australia will finally lift interest rates, but many financial commentators are putting their money on August.

While the RBA contemplates raising the official cash rate for the first time in 12 years, over the past year brokers have focused on achieving the best loan value for their clients.

The 2022 Brokers on Banks survey reveals that CBA is regarded as having the best interest rates. It has taken the number one spot in this category from Bankwest, which won in both 2020 and 2021. Macquarie was ranked third, while NAB dropped out of the top three this year.

CBA also came out on top for its credit policy, the third year in a row that the big bank has won the nod from brokers. As they have done over the last two years, Bankwest and Macquarie took second and third places respectively.

Credit policy is the most highly valued factor for brokers in this year’s survey: the majority of respondents said it was very important, ranking above brand trust,

communications, training and development, and commission structure.

When ranked on product range, which was least important to brokers, Macquarie tied with CBA for the gold medal, while Bankwest came second and ING third.

In terms of diversification opportunities, which were of equal importance to brokers as turnaround times, CBA took the spoils, followed by Macquarie and Bankwest.

“No [bank] is better than another. All seem to make profit off of their existing clients while giving better deals to new business” Survey respondent

HAVE PRODUCT RANGES AND PRICING IMPROVED OR WORSENED OVER THE LAST YEAR? Worsened significantly

2.69%

17.74% Worsened

14

No difference

50.54%

Improved significantly

25.27%

3.76%

Improved

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2022 HIGHLIGHTS: PRODUCTS AND PRICING

Interest rates

Product range

Diversification opportunities

Credit policy

2022

2021

2022

2021

2022

2021

2022

2021

1st

CBA

Bankwest

CBA and Macquarie

Bankwest

CBA

CBA

CBA

Bankwest

2nd

Bankwest

Macquarie

Bankwest

Macquarie

Bankwest

Bankwest

Macquarie

CBA

3rd

Macquarie

NAB

ING

CBA

Macquarie

Macquarie

Bankwest

Macquarie

2022 has been a particularly strong year for CBA – it has won the interest rates, product range, credit policy and diversification opportunities categories.

This is an improvement on last year when it received a gold medal for credit policy but came second in diversification and third for product range.

“My clients choose what is best for them,” one broker said. “However, CBA seems to be a popular choice, and this is mainly around credit policy, technology, turnaround times and having 100% Australian employees with no need to offshore parts of the business.”

While in the 2021 survey brokers said bank product ranges and pricing had improved 44.27%, in 2022 this fell to 25.27%.

Half of all brokers said there had been no change, while the number who said they had worsened doubled from 8.85% to 17.74%.

When asked about the banks’ pricing, one broker said: “No one is better than another. All seem to make profit off of their existing clients while giving better deals to new business.”

WHICH IS YOUR PREFERRED BANK? First home buyers CBA

NAB

Bankwest

St. George

39.78%

13.44%

11.29%

11.29%

Property investors Macquarie

CBA

NAB

29.57%

15.05%

8.06%

Commercial ANZ

CBA

NAB

31.72%

19.35%

17.20%

CBA

Westpac

ANZ

39.25%

15.59%

12.09%

Foreign non-residents

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09/03/2022 10:50:18 am

COVER STORY

BROKERS ON BANKS

SUPPORTING BROKERS

It’s no surprise that, with major growth in loan volumes, brokers are placing heavy emphasis on lenders’ commission structures WHEN YOU run a small businesses as brokers do, you want to make sure you get paid for the work you do and promptly.

While turnaround times and diversification opportunities were important to brokers when it came to judging lenders in the Brokers on Banks 2022 survey, commission structure was more so.

In 2021, commission structure was well down the list in terms of broker priorities, but its relevance has risen as brokers have pumped out a stunning number of loans this year.

More and more Australians are turning to brokers to help them navigate the increasingly diverse and complex array of finance options on offer, whether for homes or businesses.

While the latest MFAA figures show brokers enjoying almost 67% market share, many in the mortgage finance industry believe it won’t be long before brokers hit 70% and beyond.

Bankwest held the top spot for commission structure in 2022 for the third year running. Macquarie jumped from third

place in 2021 to second place this year, with ING in third. It was the second survey in a row in which no major banks featured in the top three for commission structure.

Macquarie also won the communications, training and development category, after Bankwest dominated that area in 2020 and 2021. CBA took second place, while Bankwest was voted third.

It’s clear brokers value learning and education. In a finance industry facing ever-changing regulations, the open banking

2022 HIGHLIGHTS: BACKING BROKERS

Commission structure

16

Communications, training and development

Brand trust

2022

2021

2022

2021

2022

2021

1st

Bankwest

Bankwest

Macquarie

Bankwest

Macquarie

Macquarie

2nd

Macquarie

Adelaide Bank

CBA

Macquarie

ING

Bankwest

3rd

ING

Macquarie

Bankwest

CBA

Bankwest

ING

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revolution, a wider array of loan products and providers, as well as new technology, professional development is vital.

Brokers constantly highlighted banks, particularly BDM teams, that were easy to communicate with and provided good levels of support.

Commenting on giving CBA their vote, one broker said it was “due to policy, turnaround times and open lines of communication within all departments of the bank. CBA are very proactive in picking up the phone in

Bankwest held the top spot for commission structure for the third year running.

Macquarie jumped from third place in 2021 to second place this year, with ING in third a bid to move the file on, as opposed to other lenders who tend to pend a file and send a MIR at the drop of a hat because you forgot to include the date the applicant’s grandfather climbed out a trench at Gallipoli and the color of his underpants he wore on that day”.

Finally, brand trust was the second most important factor for brokers when choosing a bank. With so many lenders and products available, brokers want to know the banks they work with have a solid reputation.

This year’s top three banks for brand trust are Macquarie, ING and Bankwest respectively. ING and Bankwest have swapped places in 2022, with ING climbing one spot to take second place.

HAVE YOU GIVEN MORE BUSINESS TO A PARTICULAR BANK IN THE LAST 12 MONTHS, AND IF SO, WHY?

YES “Bankwest – pricing on business between 80 and 90%” “Macquarie. They are efficient and turn around deals in a reasonable time frame” “CBA. They seem to have the most flexible/generous credit policy, turnaround times have been reasonable, and credit assessors are easier to deal with – they are based in Australia and provide a direct phone number to discuss deals” “Competitive rates and acceptable credit policy” “Macquarie, ING and Citibank because they offer better interest rates and turnaround time” “Bankwest for their fast turnaround, flexible policy and competitive rates”

NO “My lenders have all been quite even over the last 12 months. I find when a specific lender reduces their rates and are the best by a wide margin, they receive a couple loans in a row until another bank steps in and has a better deal/product” “No, whatever fits each customer’s needs individually” “Not really. Lender and product selection needs to meet client requirements and objectives” “No, everything is set depending on the client’s personal strategy” “Not really. I seem to spread fairly evenly; there are times that a bank will get more” “It goes where it is best for the client based on their needs and turnaround times at the time”

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09/03/2022 10:51:01 am

COVER STORY

BROKERS ON BANKS

TECHNOLOGY, TURNAROUND TIMES AND SERVICE In a repeat of the first year of the pandemic, the most frustrating and pressing issue for brokers has again been slow turnaround times, but concerted efforts by lenders have seen these improve recently MORTGAGE BROKERS have been caught between a rock and a hard place when it comes to turnaround times. They have experienced incredible loan growth, with clients demanding fast loan decisions so they can take advantage of an extremely hot property

market. On the other side of the loan equation, brokers have been hampered by lengthy delays when it comes to decisioning and processing.

Some of the bigger banks – particularly those with large offshore back-office opera-

tions – have struggled to cope with the massive surge in loan volumes and have suffered bad publicity as a result. However, with concerted efforts on their part, including hiring more credit staff and using digital tools such as DocuSign, and spurred

2022 HIGHLIGHTS: TECHNOLOGY, TURNARAOUND TIMES AND SERVICE

Turnaround times

18

Online platforms and services

BDM support

2022

2021

2022

2021

2022

2021

1st

Macquarie

Macquarie

Macquarie

Bankwest

ING

ING

2nd

CBA

ING

Bankwest

Macquarie

Macquarie

Bankwest

3rd

86 400

Bankwest

Adelaide Bank

ING

Adelaide Bank

Macquarie

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on by the lobbying efforts of the MFAA, banks started improving their turnaround times on the back end of 2021.

In MPA’s 2021 survey, 70.83% of respondents said banks’ turnaround times had worsened significantly, but this year that figure dropped to just 14.52%.

Almost 39% of brokers said turnaround times had improved in 2022, while 25.81% said they had worsened, an increase of six percentage points from 2021.

Brokers liked the fact that a number of lenders have invested significantly in technology, upgrading lending platforms and making greater use of electronic documents and digital verification of identity. They also appreciated banks that used comprehensive credit reporting to speed up the process.

“Adoption of IDYou for VOI. It’s even easier than ZipID. Increase in use of digital signatures for application forms and loan docs,” said one broker.

Another said, “CCR has reduced supporting documents and subsequently reduced approval SLAs.” For the third consecutive year, Macquarie was ranked first by brokers for its turnaround times. CBA and 86 400 placed second and third, respectively, in this year’s survey.

BDM support is also important to brokers. Macquarie topped that category this year and Bankwest placed second, with Adelaide Bank third.

IS THERE A PARTICULAR TECHNOLOGICAL IMPROVEMENT (EG NEW BROKER PLATFORMS) THAT HAS IMPROVED TURNAROUND TIMES?

YES “Yes, some banks improved their broker platform where more detailed info can be found and upfront valuations can be ordered. It also makes pricing much easier. Bankwest’s broker platform is one of the best. It also provides a snapshot of customers’ loan accounts” – WA broker “Revamped lender platforms have made it easier to track the status of an application in progress as well as coordinate any outstanding documents” – NSW broker “Ability to upload all supporting docs for most lenders now may have assisted in this regard” – Qld broker

NO “No. There is no evidence showing technologies have been applied to help the processes” – Vic broker “The turnaround times have not improved on the whole, and the biggest problem is the length of time it takes for banks to answer the phone. Waiting more than half an hour and sometimes up to two hours to get through to a broker support line with a bank or a solicitor is completely unacceptable” – Qld broker “No, the more technology and the slower things have become over the last 20 years. There is no logic to it” – WA broker

HAVE TURNAROUND TIMES IMPROVED OR WORSENED OVER THE LAST YEAR? Worsened significantly

14.52%

No difference

25.81% Worsened

11.83%

Improved significantly

38.71%

9.14%

Improved

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09/03/2022 11:29:30 am

COVER STORY

BROKERS ON BANKS

WHAT YOU’RE SAYING It’s been a roller-coaster ride for brokers over the past 12 months. Here’s what they had to say about COVID-19, channel conflict, responsible lending changes, and the assessment of living expenses by banks

PRIZE QUESTION: PANDEMIC PROBLEMS How has COVID-19 impacted the lending environment for better or worse?

“COVID has definitely impacted the lending environment, in that most lender staff are now working from home, creating inefficiencies and slower responses” “It has improved the speed of home loan applications, pushing us towards a more digital experience. Most clients prefer a complete digital experience” “It’s created opportunities to review our clients’ structures, not to mention the reduction in rates has seen my activity increase, so this has been a positive” “It’s been bittersweet as brokers have been writing record volumes but at the cost of their mental health – we have worked so hard for two years” “COVID was a blessing in disguise for the mortgage broking business. Allowed expansion outside of physical territory and the ability to hold more meetings due to no travel time” “I think worse. Banks are removing things like JobKeeper and the cash flow boost from financials of self-employed people – when if they were able to trade they would have made that money anyway”

Star comment “Customers are finding that by going to a broker they are getting a better service, including a better rate. They are understanding that brokers are there to provide advice and not just rates. This has improved the lending environment for customers. On the other hand, regulations are being eroded for the banks”

20

BROKERS HAVEN’T had a moment’s rest in the past two years.

They have had to adjust to pandemic lockdowns forcing them out of the office and away from face-to-face meetings with their clients.

COVID-19 has brought about a revolution in terms of work-from-home arrangements and the use of digital technology to communicate with clients and enable them to sign documents and verify their identities.

When asked in the survey whether the pandemic had improved the lending environment or made it worse, brokers were mainly positive about the changes it had brought. This included the ability to grow their customer bases beyond their traditional physical locations, as well as streamlining of the loan process.

An unprecedented property market boom has provided a major shot in the arm to broker businesses. But banks have been chasing these loans as well, often through first-party means, raising concerns about channel conflict, with some brokers experiencing long loan turnaround times compared to in-branch response times.

While the federal government wants to scrap responsible lending laws to speed up credit flow and strengthen the economic recovery, the proposal has yet to make it through Parliament.

Already operating under their own best interests duty regulations, brokers have mixed views about the move. Some support the removal of responsible lending laws, calling them an unreasonable burden, while others say they should stay to protect clients.

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HOW HAVE YOU FOUND BANKS’ ASSESSMENT OF LIVING EXPENSES TO BE OVER THE PAST 12 MONTHS? “Banks have done a great job on living expenses assessment, and I’ve also improved my conversation with clients on this compared to before” “Hume Bank is offering a fantastic product range with great features and at super-low interest rates across their suite. In terms of pricing, I believe that Adelaide Bank is passing on some great opportunities through their wholesale brands that are making them extremely competitive more broadly” “Living expenses is the silliest thing APRA has concentrated on. Thrown out by the High Court of Australia and banks are still requesting it” “The LE haven’t changed much.

I think each lender has their own way of assessing LE, but overall it’s been pretty consistent. You may get the occasional assessor who overanalyses an expense and tries and digs themselves a hole, but it happens” “Much better than previously when they were overscrutinising discretionary spending when we all know clients can change those expenses month to month drastically given time of year, events, etc.”

“The banks overreact and overassess living expenses due to regulation, and the use of HEM benchmarking is inaccurate”

WHAT DO YOU THINK ABOUT THE PROPOSED REMOVAL OF RESPONSIBLE LENDING LAWS? “There is currently no responsibility on the customer to provide correct information and all responsibility on lenders and brokers to validate information and investigate; the new laws remove some responsibility from lenders, although it remains very similar for brokers” “Accept conservatively. Unless it’s in law, interpreted properly by all lenders, the peak body and lawyers, I don’t really want to test where is the boundary” “They don’t need to be removed but need to have simpler systems in place to capture compliance comments” “They definitely need to be either removed or reduced. The amount of paperwork is atrocious” “That could cause greater issues within the mortgage broking industry in terms of putting customers at greater risk of not being able to repay their mortgage” “BID replaces most of what would be lost, so no difference in how we look after a client” “I think there is responsible and then there is what we have now, which scrutinises clients too much”

DO YOU BELIEVE CHANNEL CONFLICT EXISTS? “Lenders with branches will take any opportunity to rewrite a customer onto their branch channel” “It’s a major issue on all fronts – whether it is interest rates or credit policy or turnaround times” “I had a loan which I submitted, and the credit assessor declined it due to their HECS, so the client went straight to the branch, and they got that approved with exactly the same scenario” “Clients going into a branch to complete a simple task, and the branch staff encourage them to refinance to a cheaper rate, and the branch then takes the client” “All the major banks – we can only get a pre-approval back to a client on submission of all documents and I have done from two to 30 days. Customer walks into the branch and they get a pre-approval straight away and always more than we can get in our systems” “Depending on the bank, it’s still a major issue and should be dealt with via a panel” “Better rates, service levels, discounts consistently through branches”

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09/03/2022 10:52:06 am

COVER STORY

BROKERS ON BANKS

FINAL RESULTS MPA presents the overall winners of the 2022 Broker on Banks survey, highlighting the areas these banks excelled in and why brokers favoured them above the rest of the pack

MACQUARIE Position in 2021: 2nd Position in 2020: 2nd After finishing runner-up in the last two years of MPA’s prestigious Brokers on Banks survey, Macquarie has finally earned the ultimate accolade as brokers’ number one bank in 2022.

The bank has reinvigorated its strong focus on the third party channel, and its efforts are clearly bearing fruit. The bank won the top ranking this year in six of the 10 categories voted on by brokers. It won gold medals for turnaround times, BDM support, brand trust, and communications, training and development, and placed equal first with CBA for product range.

Macquarie also topped the brand trust category in 2021, and this year’s gold medal for turnaround times – which brokers rank as very important – was its third consecutive win in this category.

Macquarie also grabbed second spot for its commission structure, online platform and services, and diversification opportunities in 2022. Communications and training and BDM support have been particular areas of strength.

It’s been a rapid rise for what is now one of Australia’s largest banks by capitalisation. Just four years ago, Macquarie could only manage ninth place. It then jumped from eighth in 2019 to third in 2020 and second last year and has now surpassed Bankwest to come out on top.

The bank’s challenge will now be to cement its top spot in future surveys.

Macquarie has reinvigorated its strong focus on the third party channel, and its efforts are clearly bearing fruit

OVERALL RESULTS To generate the overall survey results, MPA took an average of the results of every category of services. This means every category had an equal impact on the final results.

Bank

Overall score

Macquarie

4.02

Bankwest

3.81

CBA

3.80

4th

ING

3.66

5th

NAB

3.48

6th

Adelaide Bank

3.42

7th

Westpac

3.31

8th

86 400

3.27

9th

ANZ

3.20

10th

Suncorp

3.20

Note: Scores go from 1 (very bad) to 5 (very good)

22

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BANKWEST

CBA

Position in 2021: 1st Position in 2020: 1st

Position in 2021: 7th Position in 2020: 3rd

Bankwest has been at the top of its game for the past two years, taking the title as the best bank in 2020 and 2021.

While Macquarie has overtaken Bankwest this year to win the number one spot, the performance by the Perth-headquartered bank with a national presence has been incredibly strong.

For the third consecutive year, Bankwest’s commission structure – a feature brokers rate as important – was voted the best, winning gold. The bank also won second spot for BDM support, credit policy, interest rates and product range and third place for brand trust and diversification opportunities.

Bankwest has slipped slightly in areas it previously ranked at the top, such as communications, training and development (which it won in 2020 and 2021) and also product range, in which CBA and Macquarie dominated this year.

But Bankwest continues to be ranked highly as a broker’s option for first home buyers.

It was also mentioned by a number of brokers who were asked which banks they had given more business to in the last 12 months. Bankwest was praised for its consistent and helpful policies for the self-employed.

CBA has lifted its game when it comes to engaging with brokers and meeting their needs.

In perennial third place from 2017 to 2020, Australia’s biggest bank fell to seventh place in 2021, most likely on the back of pressures arising from the massive growth in loan demand and a blowout in turnaround times. But in 2022, CBA is in the winners’ circle again, leaping back to third position. Brokers liked its excellent performance in four areas – CBA won gold medals for credit policy, interest rates, diversification opportunities and product range, sharing the spoils with Macquarie in this last category.

Its turnaround times have also majorly improved in the eyes of brokers, with CBA getting the nod for second spot in this category, as well as in communications, training and development.

CBA outshone other banks when it came to brokers choosing a bank for first home buyers or foreign non-residents. It was also ranked second choice for property investors and commercial clients.

In terms of sending more business its way, brokers commented on CBA’s flexible and generous credit policy, attractive rates and good customer service. They also liked its turnaround times and communication.

4th

ING

5th

NAB

Position in 2021: 3rd Position in 2020: 4th

Position in 2021: 5th Position in 2020: 7th

ING has dropped one spot this year, from third to fourth place.

One of Australia’s biggest banks, ING has always had a strong digital offering – it introduced the country’s first high-interest, fee-free online account 21 years ago.

For the second year in a row, ING has won a gold medal for its online platform and services.

Brokers also rated the bank highly in a few other areas, placing it second on the ladder for brand trust and third for product range and commission structure.

The also liked ING’s excellent rates and clear credit policies.

Australia’s third-biggest bank has maintained its fifth-place position in 2022, achieving a slightly higher score to keep that spot.

While it didn’t win any categories, NAB was rated highly by brokers as a good bank for their first home buyer, property investor and commercial clients.

In terms of how brokers ranked NAB by category, its brand trust came top, followed by product range, then commission structure.

Like the other big four banks, NAB had some difficulties with turnaround times, but a few brokers commented that its SLAs had improved and its BDM support was good.

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09/03/2022 10:52:34 am

COVER STORY

BROKERS ON BANKS

BROKERS’ PICKS As well as ranking the banks in 10 categories, brokers were asked to name their favourite mortgage products of the last 12 months. Here are the top four MACQUARIE

CBA

Offset Home Loan Package

Mortgage Advantage Home Loan Package

This year Macquarie Bank has knocked Bankwest off the top rung with this popular product, which was ranked the second most popular mortgage product in 2020 and 2021. Brokers praised Macquarie for its competitive rates, fast turnaround times and great BDM support. They also liked the fact that it allowed up to 10 offset accounts per package and featured an “excellent banking app”.

“Cheap rates, consistent credit policy, good BDM, good internet banking and client services and quick turnaround times,” said one broker, while another said, “They are very quick, consistent and easy to deal with. They also provide sharp rates.”

One broker also liked that the offset offering suited investors building portfolios, and another commented that the loan was easy to manage and track post-settlement, including retention pricing.

“It suits high-net-worth clients demanding fast turnaround and multiple offset accounts,” a broker said.

CBA’s MAV loan has certainly gained favour with brokers in 2022.

The loan package did not even feature in the top four in 2021 and was in fourth spot in 2020.

Credit policy, versatility, being simple and easy to use, the ability to split products, and pricing discounts were among the reasons brokers gave for picking the MAV package.

DocuSign was a big motivating factor for one broker. “CBA moving to DocuSign for clients in these times has assisted with fast settlements. The delays with paper processing during the pandemic caused poor service, and I was happy that CBA came to market with DocuSign,” they commented.

Another broker said, “Product was competitive and also made the product value more due to good turnaround at that time as well.”

Cheap rate-lock fees and the inclusion of credit cards also won brokers’ backing.

BANKWEST

WESTPAC

Complete Home Loan Package

Flexi First Home Loan Package

While it’s not in the number one spot it has enjoyed for the past three years, Bankwest’s Complete Home Loan Package is still a broker favourite, winning third most popular loan product.

Flexibility, highly competitive rates and quick turnaround times were mentioned by brokers rating Bankwest’s offering.

“A lot of first home buyers cannot save a large enough deposit to go 95% inclusive – this gives them an option outside of Keystart to get in and change to a lower rate after 12 months,” one broker said.

The ability to set up multiple offset accounts also impressed brokers. Other comments included: “This is a great offer with an offset option and competitive rate”, and “Guarantor loan is an excellent product and easy to understand”.

The major bank only came in seventh in the Brokers on Banks survey overall, but brokers clearly like Westpac’s Flexi First offering, voting it the fourth most popular bank product.

So, what did brokers say about what Westpac had to offer?

They highlighted the product’s low rates and flexibility.

“Sharp rate, low maintenance costs, flexible for multiple purpose,” one broker said.

In the words of another: “Lowest rate for almost any product, but still available for first home buyers at 95% LVR. Low fees and lifetime discount on a basic variable product.”

Flexi First also won points from brokers for being easy to use and understand and, as one said, “self-employed customers love it”.

M

A

24

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09/03/2022 10:52:55 am

Make the right choice today MortgageChoice.com.au/franchises

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09/03/2022 10:54:27 am

PEOPLE

EXPERT SPOTLIGHT

WENDY BROWN: DELIVERING EXCEPTIONAL SERVICE Macquarie Bank’s laser-like focus on embracing the broker channel and providing its third party partners with the best products and services has been rewarded

WHEN IT comes to its partnership with brokers, Macquarie’s work in the past 12 months has paid off for one of Australia’s leading home loan lenders.

After placing second overall in 2020 and 2021, Macquarie has won the highest honour this year as top bank in the 2022 Brokers on Banks survey. Brokers across Australia were asked to rank banks across 10 categories, and Macquarie dominated, winning five of them: brand trust; communications, training and development; turnaround times; BDM support; and product range.

Wendy Brown, Macquarie’s head of broker sales, says the bank is delighted to be named winner of Brokers on Banks.

“As a committed partner to the broker industry, we’re incredibly focused on ensuring we’re providing the best experience to our broker partners every time we work together,” Brown says. “We hope brokers see this award as our dedication to supporting them, their clients and business. One of the ways we do this is by listening to their direct feedback as it helps us identify important things to work on so we can make their experience even better.”

26

Brown says the entire Macquarie team is thrilled by the win.

“This award is a wonderful reflection of their hard work and dedication in delivering best-in-class service and outcomes for our brokers and clients.”

While some of the other major banks focused more on first-party customers, Macquarie has

share, with the latest MFAA research showing brokers are responsible for more than two in every three home loans written.

“This shows that homebuyers really are looking for that expertise and advice that a broker can provide as they navigate their home loan,” Brown says.

When it came to the five gold medals

“The Brokers on Banks award is a wonderful reflection of the Macquarie team’s hard work and dedication in delivering best-in-class service and outcomes for brokers and clients” put a lot of effort into broker partnerships.

“We appreciate the value brokers bring to their clients throughout their home loan journey,” says Brown. “More than 90% of Macquarie home loans are initiated through our broker channel, so we really see brokers as the lifeblood of our business.”

Macquarie has recognised the expanding broker channel and the growth in its market

Macquarie won for BDM support, brand trust, product range, turnaround times, and communications, training and development, Brown was happy to explain why the bank had excelled in these areas.

BDM support “As part of our focus on delivering exceptional experiences for brokers and their clients, we

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PROFILE Name: Wendy Brown Title: Head of broker sales Company: Macquarie’s Banking and Financial Services Group Years in the industry: 21+ Highest score in Brokers on Banks survey: 4.61 out of 5 for turnaround times Lowest score: 3.39 out of 5 for interest rates

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08/03/2022 12:58:23 pm

PEOPLE

EXPERT SPOTLIGHT

MEET THE TEAM

Debbie Ennis State manager NSW/ACT

Elliot Hinkley State manager Qld

Paul Chesterman State manager Vic/Tas

have built a team of specialists to provide support throughout each stage of the loan journey,” Brown says. “This includes our business development managers, state managers and broker support officers.”

Brand trust Macquarie has a strong brand heritage in Australia, says Brown. “For a number of years, we’ve been broadening our brand into the retail and consumer space. Our branding features our real clients and brokers to help tell our story. When people see our advertising, we hope they feel a genuine connection.”

One Queensland broker, Bridget MacGregor, recently featured in Macquarie’s Building more rewarding relationships with brokers campaign.

Communications, training and development “We communicate regularly to brokers to provide them with confidence in our turnaround times, as well as our latest news and important updates so they get the information they need in a digestible way,” Brown says.

She adds that the team also facilitates broker training on Macquarie products, policy and digital tools to ensure brokers are set up for success.

Product range and turnaround times “We know how important turnaround times are in providing clarity and certainty at each

28

Simon Watters State manager WA/SA

Nick Beverley National sales manager vehicle and asset finance

stage of the home loan journey, so we’ve made significant investments in our technology to transform the approval process and deliver market-leading turnaround times,” says Brown.

Macquarie has also provided new brokerspecific tools to make it easier for brokers to do business with the bank. This was no doubt one of the contributors to its success in the Brokers on Banks survey.

The bank launched a new Broker Portal in February 2021, and Brown says Macquarie is thrilled with the positive response its received.

“We’ve onboarded over 13,000 brokers since its launch in February 2021, with over 60% of them engaging with the portal to service their new and existing clients.”

The Broker Portal offers personalised and seamless in-flight application tracking and visibility of existing client details to help brokers take control.

“In addition, brokers can easily view information such as loan structure, limit, interest rate, remaining loan term and more,” says Brown.

“Our team is working hard to enhance the portal experience and take it to a marketleading level.”

The portal has been designed entirely in response to feedback, she says.

“We’ve worked very closely with brokers every step of the way to deliver a platform

that empowers them in providing exceptional service to their clients.”

In November 2021, Macquarie launched its Broker Help Centre, which Brown describes as being like a “Macquarie broker Google” that’s designed to support brokers using the bank’s products and platform.

“This gives brokers confidence that they can quickly access the right answers for their clients at any point in time. Since launching, we’ve seen over 12,000 visits to the help centre, and we’re continuing to build out the library of articles, adding to the current 250 available.”

Feedback is also instrumental to how Macquarie does business and its ability to innovate, Brown says.

“We listen closely to our clients’ and brokers’ needs. We use a range of data insights to gain a deeper understanding of our clients and brokers, delving into their needs and wants.

This helps to guide our priorities and shape the products and services we deliver.”

Brown says Macquarie is always seeking feedback to learn about how it can improve next time, “so I encourage all brokers to keep the feedback coming”.

So, what does the future hold for Macquarie following its great performance in the broker channel over the last 12 months?

“We’re excited to see what new opportunities 2022 will bring and are working together with our broker partners to achieve them,” says Brown.

“We’re looking forward to seeing the fruits of our deep-dive review of our operating model, which gave us an opportunity to enhance our procedures and further improve broker and client experience with us.”

Macquarie sees technology as key to delivering market-leading services.

“We’ll continue to enhance our broker portal, with a new function coming soon that will give brokers transparency around supporting documents on an application,” says Brown.

“This will be the first of many new innovations you’ll see from us, so watch this space.”

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BROKERS, TECHNOLOGY DRIVING GROWTH A strong relationship with brokers and a desire to help members during tough times means customer-owned banks are reaping the rewards when it comes to home loans, outpacing the big banks UNPRECEDENTED HOME loan growth over the past two years has been both a blessing and a curse for Australian banks.

Unable to travel, go to the movies or eat out during COVID lockdowns, many people reassessed their lifestyles and directed their

savings towards buying a new home, renovating or refinancing.

Some of the major banks struggled to keep pace with the massive demand for property loans, hampered by a lack of onshore processing staff. This led to delays

in turnaround times, which frustrated customers and brokers.

Customer-owned banks have thrived during the pandemic. While they, too, faced the pressure of handling a surge in home loans, they seem to have coped better than

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CUSTOMER-OWNED BANKS ROUNDTABLE

THE PANELLISTS Bankers

Simon Burt, Newcastle Permanent

Zeb Drummond, Gateway Bank

the majors, perhaps aided by being smaller, more nimble and quicker to adapt but at the same time more realistic about their limits.

The mutuals have also been boosted by their strong, strategic partnerships with the broker channel, their laser-like focus on customer satisfaction and retention, and their investment in digital tools to make

Vincent Lewis, Bank Australia

Darren McLeod, Beyond Bank

The mutuals’ net assets were up 5.5% on 2020, increasing to $10.4bn, while overall operating profit before tax rose a whopping 38.6% to $685m.

To discuss the growing success of the customer-owned banks, their relationship with the broker channel and their technology initiatives, MPA hosted a roundtable

“Brokers tell us what the problem is, and then we go away and try to solve the problem. We take that feedback on, and that’s why you’re seeing the capabilities are being developed today” Mark Middleton, Teachers Mutual Bank Limited banking and lending a streamlined experience for customers and brokers.

The results are clear: KPMG’s 2021 report on the mutuals sector shows customerowned banks’ total loan portfolio grew 5.1% to $112bn last year, compared to the overall banking industry, which grew only 1.8%.

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meeting of representatives of six key mutual banks – Heritage Bank, Newcastle Permanent Building Society, Teachers Mutual Bank Limited, Bank Australia, Beyond Bank and Gateway Bank – at Café Sydney. Brokers Michaela McDonald of Ignite Finance and Taras Mencinsky of Runmore Loans also

Mark Middleton, Teachers Mutual Bank Limited

Paul Moses, Heritage Bank

joined the conversation. Thanks to everyone who took part in this valuable discussion.

It’s been a rocky ride for the Australian economy in the last two years. How have customerowned banks met the challenges?

Like all financial institutions, customerowned banks have been hit hard by the coronavirus pandemic, with lockdowns forcing staff to work from home and pivot to digital communication with their customers and brokers. At the same time, home loan demand has skyrocketed, putting pressure on resources.

Vincent Lewis, national manager partnerships at Bank Australia, said the bank had not made a significant change to the way it does business, but growth had naturally occurred.

“We’ve got good cost control, and we’ve been diligent about making sure there’ve been no unnecessary expenses,” said Lewis.

“We’ve been very cautious about our pricing both to new business but also existing business, because it will keep our deposit customers happy. Around 75% plus of our funding is off our deposits, so it’s really

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Brokers

Michaela McDonald, Ignite Finance

Taras Mencinsky, Runmore Loans

important from a cost-of-funds perspective to do that.”

Lewis said the bank’s running costs had fallen, but profits were significantly higher – last year they were about $40m, compared to $25m in 2020.

Newcastle Permanent’s head of digital customer experience and innovation, Simon Burt, said last year there were nerves about COVID risks to the economy in certain segments, and about unemployment and the end of JobKeeper.

“We had early unease about what might happen, and actually the opposite happened.

Business for us has been really strong in the home lending space in particular,” he said.

“While there’s good lending volumes, we all need to do better and more in the digital space and invest in that to improve our processes. There’s been a lot of focus on building better systems and processes to better handle that volume.”

Burt said that as Newcastle Permanent was a smaller bank, a big spike in volume could “bury us much quicker than a major”.

All the banks represented at the table had enjoyed record loan volumes, said Paul Moses, Heritage Bank’s NSW, ACT,

“While there’s good lending volumes, we all need to do better and more in the digital space and invest in that to improve our processes” Simon Burt, Newcastle Permanent Victoria, Tasmania and SA state manager for broker distribution.

“Our sales teams and our BDMs have had to adapt to the challenges and navigate their way through how we’re going to provide a service to our members,” he said.

“A lot of that’s come through Zoom meetings, and that’s been very effective. If you look at how the industry works now as opposed to a couple of years ago, the majority of our meetings are done through Zoom, and we’re able to access our people across the regions as well.”

Darren McLeod, head of third party at Beyond Bank, said the lender had experienced a strong profit result over the last 12 months, with record loan volumes achieved by the bank and brokers.

“So in the last couple of years one of our biggest challenges has been resourcing and keeping up with just the pace of service levels,” he said.

“Beyond Bank’s only been in the broker space six years, so it’s been really good for us because the increase in broker business has meant there’s more focus on broker within the bank. It’s a lot easier now for me to get extra resources to keep up with service and turnaround and invest in technology.”

McLeod said there had been an emphasis on making sure Beyond Bank had the right resources for brokers, including its latest platform for online lodgements.

“We’re building a new broker website, so it’s just been keeping up with the pick-up in volume. I think it will be interesting over the

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next 12 months to figure out just when the market will land.”

Mark Middleton, head of third party distribution at Teachers Mutual Bank Limited, said in the past two years there had been significant challenges caused by COVID-19 and its impact on how we live and work.

“It’s been an extremely difficult time for the travel, hospitality and entertainment industries that have been hit hard by border closures, lockdowns and restrictions,” he said.

“Fortunately, at Teachers Mutual Bank Limited our people have adapted extremely well to working from home, which has meant we haven’t felt a great deal of disruption.

During the past two years over 90% of our 600 staff have worked from home at some points. While our people worked from home, we actually saw an increase in productivity as well as growth in our home loans.”

Middleton said the bank’s staff had worked

“Our sales teams and our BDMs have had to adapt to the challenges [of COVID] and navigate their way through how we’re going to provide a service to our members” Paul Moses, Heritage Bank hard to deliver for brokers and members during times of hardship.

“As a mutual, we’re committed to supporting and serving our members through the good times and the challenging times.”

Gateway Bank’s head of customer operations, Zeb Drummond, said it was clear from research that customer adoption of digital channels would continue during the

pandemic and in a post-COVID world.

Drummond said customers had been forced to adapt to new technology, but their satisfaction and comfort with those channels was yet to follow.

“I think there’s a lot of time and effort to go into those digital channels, not just to make them work but to actually deliver a good experience for both customers and brokers.”

MUTUALS’ LOAN PORTFOLIO GROWTH, 2017–21 All ADIs

Major banks

Mutual banks

12%

10%

8%

6%

5.1%

4% 1.7%

2%

1.6% 0%

2017

2018

2019

2020

2021

Source: KPMG Mutuals Industry Review 2021

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What drove overall customerowned banks’ lending growth of 5.1% last year, and how can this be sustained? Did the trend towards regional living play any part?

The move away from the cities into regional and rural Australia has been a major factor contributing to home loan growth during the pandemic.

Burt said Newcastle Permanent’s customer heartland is Newcastle, the Hunter Valley and the Central Coast, and the building society’s growth was being driven by people moving to these regions and by the broader reach of the broker channel.

“We’ve seen many people who work in Sydney visit for a weekend and think, ‘I could work from here and keep my job’. I wouldn’t call it a sea change, but really it’s that ability to work from home, and that’s driving a lot of migration into Newcastle at a rate I’ve never ever seen before.”

He said customer-owned banks had tried to win business from the majors rather than each other and had done well at that, especially in the refi market.

“Each of us has a separate point of difference. In the broker space, ours is focused on outstanding relationships with brokers, be it from our BDM teams or our credit teams, who are based in Newcastle, as well as great products and competitive pricing supported by leading technology, which allows us to deliver consistent time to yes.”

Middleton agreed there had been growth in the regions, with Southeast Queensland, the Riverina and Mornington Peninsula being particularly popular. He said it had been great to see growth across the mutual sector. At Teachers Mutual, home loan balances had risen 20.1% to $7.7bn in FY21.

Teacher Mutual members had poured money into savings or taken advantage of historically low interest rates to buy a home, creating a buoyant housing market, Middleton said. Most of its members work

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“You can try to grow more aggregator partnerships or break the mould with how many brokers, but we’ve stuck with the game plan, and it’s paid off.

Our SLAs have been solid” Vincent Lewis, Bank Australia in education, emergency and health.

“This certainly helped our growth in home loans as our members maintained steady employment throughout the pandemic.”

Middleton said brokers had become an integral part of business growth – they now contributed more to Teachers Mutual’s lending volumes than first party.

McLeod agreed and said mutuals’ lending growth was largely due to the broker channel.

“The broker space is a big part of most of our businesses now. From Beyond Bank’s

point of view, the broker has made first party get on their toes a bit – it’s raised the bar for the bank in general. It’s good, healthy competition. Not only is the broker business growing, our first party is growing.”

Lewis said Bank Australia had been very lucky in terms of loan growth.

“I say to my team, we don’t have to look too hard for business; it just comes in the door.

“You can try to grow more aggregator partnerships or break the mould with how many brokers, but we’ve stuck with the game plan,

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and it’s paid off. Our SLAs have been solid.”

Bank Australia has enjoyed 20% home loan growth for the last few years, and this is ongoing. Lewis said more resources were being considered for brokers as this channel had become vitally important.

“The brokers have rallied the troops in the rest of the bank, and the retail team are now chasing us. Last year we funded $1bn for the first time through broker, and we targeted about $800m. At the moment, we’re looking at $1.3bn this FY year, and they’re about a billion, so we’re all lifting each other.”

Lewis said brokers now wanted to write loans away from the major banks.

“This seems to be happening more and more often – people want those personalised services that a mutual can offer.”

Drummond added that the movement to

regional areas was astronomical, driven in part by the changing nature of housing.

“The house now is not just a home; it’s where you work, it’s where you’ll celebrate a wedding or have a funeral for the loss of a loved one in some instances. I think that’s reflected in the growth of house prices.”

What are you doing to increase awareness among mortgage brokers of the value that customerowned banks offer?

The brokers taking part in the roundtable had some valuable feedback for the customerowned backs.

Michaela McDonald, owner and home and business finance manager at Ignite Finance in Campbelltown, said customer-owned banks provided much better customer service

and interest rates than the major banks.

“I’ve had clients come back to me and say the experience was so good … that they come back to me bringing their second owneroccupied property or another investment property where they wanted to rewrite it with the same bank because they’ve been so happy with the back office.”

McDonald said she had good relationships with the mutuals, and their back offices were completely different to those of the majors.

“These guys are more approachable; whether it be for particular deals, they’ll back you. Major banks, they just don’t have that sort of support … I love the smaller banks and I back them; the rates are better.

She said having a 100% offset account on a fixed rate loan was another feature that many customer-owned banks offered but the

TOP 10 MUTUAL BANKS BY TOTAL ASSETS, 2021

Great Southern Bank (formerly CUA)

$18.78bn

Heritage Bank

$11.94bn

Newcastle Permanent

$11.70bn

-4% 11% 5%

Teachers Mutual Bank Limited

$9.76bn

20%

People’s Choice

$9.67bn

2%

Bank Australia

$8.47bn

Greater Bank

$8.07bn

7%

Beyond Bank

$7.76bn

10%

18%

IMB Bank

$6.96bn

3%

P&N Bank

$6.93bn

12%

Source: KPMG Mutuals Industry Review 2021

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“Community banks really need to focus on educating brokers – this is what we can offer; this is what our internet banking looks like, how it integrates with the client” Taras Mencinsky, Runmore Loans majors did not, and it was a big selling point for McDonald’s clients.

Taras Mencinsky, owner and senior credit adviser at Runmore Loans in Sydney, holds similar views. He says about 30% of his loan business goes through communityowned banks.

“You really get to know them, and they get to know you, and you can have a chat to them and it’s really very helpful.”

To encourage more business from brokers, community banks needed to “show how they

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can provide a full banking experience”, Mencinsky said.

He pointed out that brokers and prospective customers did not know how good a community bank’s online service would be; some feared it wouldn’t be suitable for their needs.

“Community banks really need to focus on educating brokers – this is what we can offer, this is what our internet banking looks like, what you can do with it, how it integrates with the client.”

Mencinsky said that while there was an inertia to change banks, people were prepared to accept a slight premium on their rate if they felt the value of the service was better than their current bank.

“So it means you’re not in a race to the bottom on price; the broker can back up the offering and say, ‘Look, this bank is going to be really good for you because of X, Y, Z’.”

He added that some clients sought intangible benefits such as banks’ social impact, and brokers could offer these features as a value-added experience.

Middleton agreed, saying feedback provided by brokers showed that customers were looking for banks that demonstrate corporate sustainability and ethics in their operations.

Teachers Mutual is a member of the Global Alliance of Banking on Values, alongside Bank Australia.

“We believe that banking can be a force for good,” Middleton said.

He explained that the pandemic changed the way Teachers Mutual increased awareness among brokers, given that in-person events run by the MFAA and FBAA and aggregator PD days had not been possible.

“In lieu of this, we focused on our technology and broker experience in 2021.

Working with NextGen, we’re always looking to evolve our solution in the market and ensure it’s a smooth process for brokers and their clients,” Middleton said.

Moses said Heritage Bank, headquartered in Toowoomba, Queensland, had opened a branch network in NSW. “We’re working with the state manager of the branches to meet brokers in person and really foster a positive partnership where the actual branch is assisting the broker to get a member onboarded.”

Burt said that, as people-based organisations, customer-owned banks had great staff who did a good job of calling brokers and introducing clients. “But we also have to do a good job of having the right technology, the

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TOP 3 CONTRIBUTORS TO MUTUALS’ GROWTH

22.3%

21.4%

Better customer service

Better product pricing

18.8%

Customer-centricity and product innovation

was on increasing personalised service to brokers. “It’s what they really want that sets us apart from the majors. We’re in touch with our broker partners on a very regular basis, and we maintain that.”

Moses agreed that EDMs could be overdone and said Heritage was investing a lot of money in digital technology, which would improve broker communication.

Mencinsky added that another factor that had really helped community banks in the last five years was the remuneration structure for brokers. Now that inducements for writing loans had disappeared, this created more of a level playing field for the mutuals.

Source: KPMG Mutuals Industry Review 2021

“These guys [at customer-owned banks] are more approachable; whether it be for particular deals, they’ll back you. Major banks, they just don’t have that sort of support. I love the smaller banks” Michaela McDonald, Ignite Finance mobile app that can support their day-to-day banking, but also sell it,” he said.

Lewis said staff surveys were also important. Bank Australia had just completed one, and early results revealed an increase in staff satisfaction this year.

He said if staff were on board with a bank’s vision, they would do a good job of helping a broker bring a customer into the system.

Drummond added that the banks needed to ensure they used the right channels to communicate with brokers.

“Not every broker is reading EDMs, so it’s around making sure that when we commu-

40

nicate, it syncs, it’s appropriate and reasonably educational for those brokers.

“So not just ‘our BDM went on holiday to Hawaii’ but, you know, ‘last week we did a scenario of this, and this is the kind of deal we can actually accommodate’.”

Drummond said the key was for banks to ‘overservice’ brokers when it came to communication, to educate them so they “know what we do, what we do well and how we can help their customers”.

“It’s not just one deal and not just one customer, but it’s multiple customers you’re potentially impacting for a better solution.”

At Heritage Bank, Moses said the focus

Digital disruption, in the form of AI and other technology, is a potential game changer. What are your plans in this space?

Burt said this was his favourite topic, and for Newcastle Permanent this calendar year “would be all about spending money, time and effort on being compliant with open banking regulations and having our data in the open banking ecosystem”.

He said banks would reach the tipping point in 2022, when they would be able to make the lending application process so much easier for customers through open banking, enabling them to pull in customer information and populate living expenses and income.

McLeod said Beyond Bank was close to launching digital signatures for the entire loan process in partnership with FMS. “We’ve also partnered with a company called Eula, who do a lot of AI for retention.

We’re going to be launching that as well, using machine learning to predict which customers might leave.”

He said Beyond Bank was also building a new broker website and investing heavily in NextGen’s ApplyOnline platform.

“We’re also upgrading our loan origination platform, which will assist in streamlining

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“What we’re looking at is an environment where we can celebrate fintechs coming to market, and we can support them because of our size and the nature of mutual banking” Zed Drummond, Gateway Bank the loan approval process and significantly improve turnaround times.

“We’ve also got to jump on board with those strategies and those new initiatives to make sure we are fast and seamless, because we need to be leading the way in this space and not be a follower.”

Burt said Newcastle Permanent was using DocuSign for end-to-end processes, avoiding the need to rely on posting documents in the mail. “In some cases we’ve been able to reduce loan approval time from days to hours.

It’s been a real game changer.”

At Heritage Bank, Moses said the team had been working on its home loan origination platform and the introduction of robotics into its back office.

“It’s not to cut costs or staffing, but it’s about providing a better experience for our members.”

Gateway Bank initiated a project in 2020 to bring in a new loan origination platform.

“One of the key elements was that it had to be able to swap and change integrations as quickly as possible,” Drummond said.

This meant the system could add in new solutions offered by fintechs.

“What we’re looking at is an environment where we can celebrate fintechs coming to market, and we can support them because of our size and the nature of mutual banking.

We can get them into the market and actually realise the benefit of partnering them with our origination platform.”

Drummond said Gateway Bank was working to extend digital signatures so the verification of the signing of digital documents could be done through proof of life and video.

Teachers Mutual has launched a new digital bank, Hiver, and is also using robotics to extract information from loan applications and speed up the process.

“It’s the first digital bank out there that focuses on the essential service workers and university students and graduates,” Middleton said. “It offers 24/7 access to their money, with instant transactions through OKSO, digital wallet capabilities for seamless tap-and-pay experiences, and even the ability to track spending habits through smart categorisation.”

Lewis said Bank Australia was also using robotics to analyse statements and speed up processes in other parts of the business.

“We’ve been using e-documents for quite some time, and that’s been a great benefit, but we’ve also extended DocuSign into a number of NextGen-type low-docs.”

Bank Australia also plans to change its basic lending platform from Simtrex and replace it with a more up-to-date system.

“Our bank’s board is committed to a significant investment into the platform and CRM upgrades this year,” Lewis said. “We’ve been using IDYou, which is a face-to-face digital application, and I see that as being a significant improvement in our service over the last couple of years.”

Seeking the brokers’ input, MPA asked Mencinsky and McDonald what they thought of the mutuals’ digital offering and how it could be improved.

Mencinsky said banks needed to make the loan process quicker, and the fewer written signatures required the better; eDocs and DocuSign were a blessing.

“People are not working in the office, so they can’t use the office printer. It adds two or three days to the process, and it’s very inconvenient.”

McDonald said it was “a bit backward” to

MUTUALS’ TOP 3 PRIORITIES FOR NEXT 3 YEARS

61.0%

29.3%

Maintaining profitable and sustainable growth

Digital transformation

9.8%

Keeping up with pace of change (eg regulations, fintech, open banking, NPP)

Source: KPMG Mutuals Industry Review 2021

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CUSTOMER-OWNED BANKS ROUNDTABLE

Middleton added that brokers supplied plenty of creativity.

“You tell us what the problem is, and then we go away and try to solve the problem. We take that feedback on, and that’s why you’re seeing the capabilities are being developed today. Keep the feedback coming, because we do actually take it on board.”

There’s been a high number of mergers recently. What do you think of this consolidation trend?

Is it good or bad for the industry?

“We’re building a new broker website, so it’s just been keeping up with the pick-up in volume. It’ll be interesting over the next 12 months to figure out just when the market will land” Darren McLeod, Beyond Bank require clients to sign a bank’s loan application physically, so banks that could provide fully digital documents would encourage customers to say, “It’s a bank I want to be with”.

Both Burt and Middleton commented that broker feedback was vital for customerowned banks to be able to continue to improve their broker offering.

Burt said getting feedback from brokers and acting on it quickly was what set the mutuals apart from the majors.

“The ideas that are coming from you guys

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now – we hear those ideas, we talk to brokers all the time, and we can make a change next week,” he said.

Being smaller and nimbler, mutuals also needed to set up partnerships with fintechs to benefit from the best technology and remain competitive.

“That whole process and relationship with setting up a partnership with the fintech should be much easier, because we’re not trying to buy them like the majors are trying to,” Burt said.

Heritage is in a proposed merger, Moses said. “We’re looking to merge with People’s Choice Credit Union. This merger would create the largest customer-owned banking organisation in the country. We think this would be absolutely positive for the industry, as it would create a powerful national mutual that would have increased size and scale, with greater capacity to compete against the majors.”

Moses explained that the merged organisation would retain its mutual status and its total focus on serving its members.

“The increased size and scale is particularly important in implementing the technology improvements needed to remain competitive and deliver the services that banking consumers want.”

In August 2021, Newcastle Permanent and Greater Bank announced a proposal to merge to create one of Australia’s largest leading customer-owned financial institutions.

Burt said building strength through consolidation was not new – in the past decade the number of mutuals across Australia had halved to fewer than 70 today as a result of smaller players uniting to remain competitive and sustainable.

“That trend is set to continue; the 2021 KPMG Mutuals Report noted that a quarter of Australian customer-owned banking organisations anticipate being involved in merger activity this year alone, and a

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CUSTOMER-OWNED BANKS ROUNDTABLE

further 20% are considering the possibility.

“We believe together we can deliver better outcomes for our customers than either Newcastle Permanent or Greater Bank can achieve alone. By pooling our resources and combining our investment, we’ll be able to innovate, to develop and deliver the new banking technologies our customers and our partners, such as our Newcastle Permanent

“This is a good thing for not only our customers but the industry as whole, as the mutual customer-centric approach has huge competitive value, provides a great service to our memberships and will continue into the future.”

Teachers Mutual merged with Firefighters Credit Co-Operative and Pulse Credit Union in Victoria. Middleton said its board of

“A strengthening of the mutual sector through consolidation bolsters the retention and growth of our united member bases and gives greater combined power to the sector” Zeb Drummond, Gateway Bank broker partners, want today and will need in the future.”

McLeod said that over the last 15 years Beyond Bank had completed several mergers, and these had been an important part of its national expansion into new areas.

“We believe where the two organisations can come together and create mutually beneficial outcomes for both the community and the organisations, they are a great way of building out a value proposition.

“In every merger BBA has done, we’ve seen growth in that area and development of the people from the merging organisation.”

Drummond said recent mergers had been in the best interests of the respective member bases.

“If the memberships felt otherwise, then the mergers wouldn’t have been approved,” he said.

“A strengthening of the mutual sector through consolidation bolsters the retention and growth of our united member bases and gives greater combined power to the sector.

directors had identified these opportunities as “we share a lot of values with these two credit unions”, and they were optimistic about possible future mergers.

“These mergers also allowed us to grow our market share in Victoria and strengthen our ties to the firefighter, healthcare and tertiary education communities.”

Consolidation would continue in the industry, Middleton said.

“The impacts of digital disruption, reducing margins, regulatory change and challenges from the pandemic are being felt by mutual banks and credit unions. These factors mean it’s likely we will continue to see like-minded mutuals come together.”

Lewis said mergers and consolidations had been ongoing during his 20 years in customer-owned banking.

“I have been involved in at least four acquisitions, albeit on the acquirer side, and each one was a significant step up for the strength and future prosperity of the merged entity,” he said.

“As a general rule I feel mutuals merge well, are respectful of the heritage of the merged entities, and look after their staff during and after the process.”

Lewis said he understood members or customers’ disappointment when their beloved credit union merged into a larger entity, but such mergers were a good thing for the mutual banking sector.

“The remaining institutions are financially stronger and thus are better able to meet market and regulatory demands while competing more aggressively with the broader market,” he said.

TOP 3 BIGGEST RISKS FOR MUTUALS

48.8%

26.8%

26.4%

Low interest rate / margin environment

Information technology including cyber risk

Compliance & regulations

Source: KPMG Mutuals Industry Review 2021

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FEATURES

SPECIALIST LENDING

Freedom of choice for borrowers A growing number of people don’t fit the prime borrower profile, providing opportunities for non-bank lenders to offer specialist loan solutions IT’S HARD to believe it’s already March 2022 and Australians are hopefully close to the point where we can leave COVID-19 behind in our collective rear-view mirror, with businesses recovering and a return to a sense of normality.

While the last two years have been tough economically, socially and mentally, non-bank lenders have continued to support brokers and their clients with their finance needs.

Unlike the major banks, which have largely narrowed their lending to focus on PAYG prime residential home loan customers, nonbanks have continued to offer finance options for those clients that don’t fit the vanilla profile, such as the self-employed.

The specialist lending market is growing for a number of reasons. More people are becoming aware of the variety of finance options available to them, thanks to their brokers. And as the economy bounces back, SMEs are seeking finance for equipment, infrastructure and debt consolidation.

MPA spoke to leading non-bank lenders Pepper Money, Liberty, La Trobe Financial and Grow Finance – which all have specialist lending in their DNA – to find out what they offer in this space and how they can assist brokers and their clients.

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What is specialist lending?

Liberty group sales manager John Mohnacheff says specialist loans are designed to support customers who may not fit traditional lending criteria, providing greater freedom and choice.

“By taking a more personalised approach, specialist lenders like Liberty can provide options tailored to a customer’s unique circumstances to help find the best fit,” he says.

Mohnacheff says Liberty, as one of the first Australian lenders to offer custom solutions, understands the diverse needs of these borrowers and how vital they are to the market.

“Whether a customer has experienced previous credit issues or simply prefers to do things differently, specialist loans support brokers to help more customers achieve their goals,” he says.

Cory Bannister, senior vice president and chief lending officer at La Trobe Financial, says a ‘specialist’ borrower sits just outside the bank’s automated underwriting credit criteria. They require manual desktop underwriting credit assessment techniques to appropriately assess and ultimately approve their application.

“A common misnomer is that specialist

borrowers have impaired credit; this is simply not the case,” Bannister says.

“Factors resulting in a borrower being overlooked by major banks include unforeseen changes in employment, variability of income or expenditure, or simply seeking a product that is no longer being offered by the major banks, such as in the case of an SMSF.” Pepper Money general manager mortgage and commercial lending Barry Saoud says specialist loans are designed to provide financial options for borrowers who are unable to meet the requirements of traditional lenders for a range of reasons, including not meeting credit score requirements, having an impaired credit history, or being unable to provide the traditional income verification documents.

“Traditional lenders like traditional

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enviable position of being able to access a broad spectrum of specialist asset finance and working capital loans that support growth.”

Specialist loan offerings

“Helping SME borrowers in need is good business. They will remember your help and may become lifelong clients who refer other business” Cory Bannister, La Trobe Financial income,” Saoud says. “But in real life, people earn money in different ways – from the self-employed to contractors’ shift work, casual work and more. You’ve got a subset of Australians who are very successful on their own merits, but they’re generally shut out of prime loans simply because they don’t fit the strict lending criteria.”

Co-CEOs of Grow Finance David Verschoor and Greg Woszczalski define specialist lenders

as providing finance to individual or business borrowers that fall outside the lending criteria of mainstream funders.

“Specialist lenders are renowned for being more flexible in their loan criteria and accept borrower profiles,” says Verschooer.

“The groundswell of non-bank borrowers continues to sustain demand for specialist finance loans, particularly in the buoyant small business sector. SMEs are now in an

Saoud says Pepper Money has always been passionate about providing real-life solutions, especially in specialist lending.

“We take an inclusive approach to lending, meaning if we can find a way to help, we will.

Instead of just using algorithms, we developed a more flexible approach that allows us to assess cases individually.”

Pepper Money’s client base extends from blue-chip to blue-collar and includes home loans, car and electric vehicle loans, equipment and asset finance, commercial loans and personal loans.

Saoud says it offers a great range of competitive, flexible loans for the growing number of customers who are finding it difficult to secure a loan through banks and other traditional lenders.

“We intimately understand the needs of the self-employed and specialist borrowers and individually assess each home loan application on its individual merits.”

Pepper Money supports brokers in helping customers achieve their goals and, by listening to feedback from brokers, customers and BDMs on how to improve products and services, “we have been able to create and maintain an award-winning specialist suite”, Saoud says.

Boasting 70 years of finance innovation and the title of Australia’s oldest non-bank of size, with $13bn of assets under management, La Trobe Financial has the heft and scale to be regularly considered as borrowers’ top choice, Bannister says.

The key differentiator is La Trobe Financial’s product range.

“We have the broadest product suite in the non-bank market which has been modelled on having a product for every life cycle in mind for brokers, and our loan size goes much deeper – up to $25m,” says Bannister. “Our product suite covers everything from prime

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SPECIALIST LENDING

to near prime, residential and commercial, development finance, SMSF solutions, aged care and first home buyers.”

La Trobe Financial also understands that the typical broking business is evolving from a ‘monoline’ operation focusing on residential, commercial or asset finance to offering a more diversified, holistic suite of products and services.

“We have adapted our business in line with this change,” Bannister says.

Grow Finance is a leading non-bank business lender that was recently recognised as the fastest-growing company in the 2021 AFR Fast 100 following a 549% year-on-year increase in revenue.

“With a diverse portfolio of asset finance and working capital solutions, Grow is increasingly the non-bank of choice for businesses borrowing up to $5m to boost growth,” its co-CEOs say.

“Grow’s vision is to enable businesses greater access to finance by being a ‘one-stop shop’ for all asset finance and working capital requirements. This includes asset finance, trade finance, invoice finance, floorplan finance, insurance premium finance and business loans,” says Woszczalski.

Mohnacheff says Liberty is a pioneer

LENDER’S TAKE MPA: What do you need from brokers who are submitting a loan application?

John Mohnacheff, Liberty: If you’re ready to take your business forward, incorporating specialist lending into your business is an excellent way to do so. Not only can it support you to expand your reach, but it can also help you provide customers with a more comprehensive and well-rounded lending experience.

on a case-by-case basis to ensure we get the full picture.”

Liberty also works with brokers to collect all the required information, and Mohnacheff says it’s one of the few lenders that provide direct access to the underwriting team.

“Our BDM team is highly regarded for its hands-on support, and with Liberty you know that there is always someone available to answer any questions you might have along the way.”

Demand for finance; loan trends La Trobe Financial is confident brokers will receive a major boost on the back of the pandemic now and into the future.

“While there have been major shifts across many industries, appetite for credit remains high – and the demand for specialist solutions remains strong” John Mohnacheff, Liberty in the specialist lending space with almost 25 years’ experience.

“Liberty has developed innovative and effective processes designed to help brokers achieve better outcomes.

“Recognising that there is often more to a customer’s story than what is listed in their credit file, we assess each application

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“We know that where there is confusion and complexity there is opportunity, and that environment has always provided tailwinds for brokers. Similarly, these same tailwinds relating to complexity and confusion have always been supportive for NBFIs,” Bannister says.

Given that there are thousands of loan

products in the market, consumers couldn’t be expected to navigate through them all, particularly in a fast-changing environment.

“Brokers can use their technology, knowledge and experience to distil these options quickly and appropriately to assist customers,” Bannister says.

“As a result, we expect to see broker share climbing above 70% plus, and we expect to see NBFI market share heading back to 10% and beyond.”

Saoud says specialist lending has become more relevant as customers such as business owners have faced challenging emotional and financial events over the past two years.

“People have had their businesses closed, their employment interrupted, cash flow reductions and savings patterns disrupted.

This has brought a need for specialist lending to people that would not have considered it necessary in the past.”

In a shifting and volatile environment, there’s a greater appetite for specialist lending options, and this will continue to grow postpandemic, says Saoud.

“More brokers are seeking the assistance of specialist lenders – from the growing selfemployed market to people with different types of income, those recovering after a life event or building a property profile.

“To help us deliver great outcomes for our brokers and their customers, we’re making big investments in our digital capabilities and new products to better meet the needs

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of this category across the next 12 months,” Saoud says.

Mohnacheff says the economy has encountered significant hurdles over the last two years but has shown its resilience time and time again.

“While there have been major shifts across many industries, appetite for credit remains high, and the demand for specialist solutions remains strong.

“As a lender, we are closely monitoring these developments and continually looking for ways to better support the growing number of customers within this changing landscape.

And, for brokers, experience in specialist lending is becoming an essential component of running a successful business.”

The days when a specialist loan was perceived as a second choice have long gone, Mohnacheff says. He expects that as more customers become aware of the advantages of this option, demand will continue to grow.

“Increasingly, we’re seeing first home buyers look to specialist loans to help them break into the property market, achieving outstanding results,” Mohnacheff says. “Our flexible solutions allow buyers to reach their goals faster, which in some cases means they can start to take advantage of rapid market growth as they begin to accumulate equity.”

At Grow Finance, Woszczalski and Verschoor say specialist lending is constantly evolving to meet current and emerging demands for business finance. The pair say the following are some of the current trends.

• high demand for asset finance (trucks, trailers and materials handling) • an increasing demand for debt financing to reduce cash flow pressure • businesses that have struggled or significantly changed operations opting to rapidly sell unwanted or underutilised assets – this correlates with increased demand for funding to purchase used assets, exacerbated by supply chain issues for new stock • businesses placing orders earlier and making larger orders to offset supply chain uncertainty and keep a comfortable buffer of stock on hand locally (new and existing ranges) • a sharp rise in demand for fit-outs to accommodate increased patronage as COVID restrictions ease and the ‘new normal’ is accepted

Helping clients through tough times There’s no doubt the self-employed and business owners have struggled over the past two years, but specialist lenders are uniquely placed to understand their circumstances and assist them where possible.

Saoud says that in an interrupted economy historical financial statements may not reliably demonstrate the customer’s trading position or profitability and may fall short of meeting traditional full-doc criteria.

“Specialised lending for us tends to be more about the uniqueness of the transaction that may vary certain pivotal credit criteria, such as

LENDER’S TAKE MPA: What do you need from brokers who are submitting a loan application?

Cory Bannister, La Trobe Financial: The key is to understand the borrower’s situation and be able to communicate that clearly to the lender. The more information we have up front, the quicker and easier we can provide a solution.

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high LVR, non-standard sources of income, or transaction structure,” he says.

Pepper Money understands that unexpected life events can happen, so it looks at customers’ wider circumstances on a case-by-case basis to see if the borrower is in a position to service a loan.

“We don’t let the past or ‘rough times’ define the customer’s future,” Saoud says.

Access to capital largely depends on whether the SME is a growth business that has hit a tough patch or is a business in decline.

“If it’s the former, we encourage businesses to collaborate with their broker and accountant to determine how much funding is required – and, most importantly, that it can be serviced with a clear exit plan without distressing or exposing the business,” says Verschoor.

Bannister says that in La Trobe Financial’s experience SME borrowers simply want three things. “Firstly, they want to be listened to – it’s likely in the current environment that an SME customer has been rejected by their trading bank because ‘the computer said no’, therefore they are seeking someone prepared to listen to their circumstance with an open mind.”

Borrowers want advice – often they are “confused and possibly a little dejected”, Bannister says. This is a great opportunity for brokers to showcase their value proposition of choice, advice and a fair go, guiding them through a short-term “life event”.

Lastly, the customer wants a suitable solution that satisfies their goals.

“Helping SME borrowers in need is good business,” Bannister says. “They will remember your help and may become lifelong clients who refer other business.”

Big potential for higher market share The major banks’ focus on prime borrowers has enabled non-bank lenders to fill a gap in the market. MPA asked the non-bank lenders whether they expected the growth in specialist lending to continue.

Mohnacheff says non-banks have traditionally offered more flexible solutions

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FEATURES

SPECIALIST LENDING

LENDER’S TAKE MPA: What do you need from brokers who are submitting a loan application?

Barry Saoud, Pepper Money: Every customer navigating the complexities of applying for a loan deserves choice, convenience, and service they can trust. That’s why brokers have the opportunity to showcase their expertise to their customers like never before – whether they need a quick response or a lender that will help them work through a life event. Brokers can trust us to deliver; we are transparent, easy and fast, which provides brokers with confidence for offering specialist lending solutions.

and can generally cater to a more diverse pool of customer needs.

“Liberty’s credit policies have focused on flexibility since day one, and our decades of experience support us to deliver highly competitive options,” he says.

“The big banks typically don’t have the same experience or flexibility to offer highly tailored lending solutions to meet a much broader range of customer needs.”

As a specialist lender with solutions for home, car, business, personal, commercial and SMSF loans, Mohnacheff says Liberty’s depth of products is hard to match.

There are 2.4 million SMEs contributing $421bn to the economy – the sector is evolving and so are its needs, say the Grow Finance CEOs. “Grow Finance will continue to extend or enhance products, launch new products and blend products to meet requirements for asset finance and working capital solutions.”

Key factors driving growth include the submetro greenbelt construction boom; the hybrid work-from-home model resulting in mass sea and tree changes and a big spike in home renovations; and ongoing supply– demand issues.

Another factor is the “post-lockdown” change in business confidence, boosting investment in business, such as through

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fit-outs and equipment purchases, they add.

“Similarly, there’s a rise in mergers and acquisitions to bypass organic growth.

Consequently, there’s a spike in demand for asset finance, invoice finance and trade finance facilities,” says Woszczalski.

Bannister points to the fact that major banks’ risk appetite and target customer profiles can change, and this can be seen right now in the persistent tightening of bank acceptance criteria due to their simplification strategies over the past three years.

‘overlooked’ borrowers would have been likely to fit bank acceptance criteria of the past decade.

“We expect this focus [of the majors] will only intensify, and we are terrifically positioned along with the other major NBFIs to play one of the most important roles in the mortgage lending space over the next three years.”

Saoud says that, looking ahead, specialist lending will continue to provide solutions for borrowers who don’t meet mainstream lending criteria and require a lender that will consider their individual circumstances.

“As we navigate through another challenging year, a lender that can support customers by considering their current income and situation will be important to helping those businesses continue moving forward.

More brokers – and in turn their customers – recognise the true value that non-bank lenders like Pepper Money can provide them.”

Benefits for brokers Specialist lenders benefit businesses and brokers alike, says Verschoor.

“Specialist lenders enable business borrowers to quickly gain access to flexible and

“We intimately understand the needs of the self-employed and specialist borrowers and individually assess each home loan application on its individual merits” Barry Saoud, Pepper Money “The major banks are pursuing a much narrower and specific segment of the market, being the prime vanilla home loan, a segment that can be scaled en masse, thanks to highly automated credit processes that require very little human intervention or oversight.”

The result, says Bannister, is that today’s ‘near prime’, ‘specialist’, ‘underserved’ and

aligned funding to support growth or alleviate challenges. Similarly, specialist lenders extend brokers’ value proposition, help create ‘stickier’ clients and boost revenue,” he says.

“We encourage brokers to let us know their SME clients’ needs, and we will work collaboratively to deliver the best possible outcome, whether it’s a single product or

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“The groundswell of non-bank borrowers continues to sustain demand for specialist finance loans, particularly in the buoyant small business sector” Gregory Woszczalski and David Verschoor, Grow Finance multiproduct structured solution. This model supports brokers of varying maturity in commercial finance.”

Bannister says La Trobe Financial has one of the broadest ranges in the market, covering first home buyers, upgraders, downsizers, the self-employed, those looking to build a home, and others wanting to build their retirement nest egg via an SMSF loan.

He says all these needs can be served by a specialist loan, depending on the borrower’s circumstances – whether they have variable income, or have had a change in employment or a minor credit impairment, or they are self-employed without up-to-date financials.

“This changing dynamic of a borrower’s circumstance throughout their life cycle provides the greatest example or proof point of the broker CVP – certainly more so than any vanilla automated home loan.”

Advantages for brokers include the opportunity to diversify revenue sources, expand business capabilities and protect their customer base by creating ‘stickier’ clients, Bannister says.

He adds that by following responsible lending guidelines brokers are well equipped to complete near prime applications. “There is no difference between a broker’s approach to selling a prime loan and selling a specialist loan; the process is the same.”

Bannister says La Trobe Financial’s 200-strong credit team and its upcoming digital enhancements are here to make life easier for brokers and their clients’ needs.

At Liberty, Mohnacheff says brokers and their clients are provided with a wide range

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of loan solutions. “Not only does this equip brokers to support a more diverse customer base, but it also allows them to continue providing the kind of support customers need, should their financial situation change.

“We offer competitive loans to support customers in all kinds of circumstances. Even when supporting customers with complex credit histories, we make it easy to find suitable solutions that tick all the boxes.”

Mohnacheff says for each of its loan products Liberty has specialised BDMs, underwriters and support personnel available to brokers.

“Through Liberty IQ, we are also one of the few specialty lenders offering electronic support and delivery with real-time updates.”

Liberty’s highly experienced, awardwinning BDM team is also available to walk brokers through the loan process and answer questions, Mohnacheff says.

“From a broker’s perspective, the process of writing a custom loan application is

not significantly different to submitting a conventional loan.”

Saoud says brokers who educate themselves on specialist lenders such as Pepper Money will cope best with changes and ensure their business flourishes.

“The appeal of specialist lending is far broader than many brokers may realise … it’s not limited to people who have had a credit event. Investors, the self-employed and families, to name a few, are all potential borrowers who can benefit from a specialist lender,” he says.

“We also engage with brokers on declined deals and look for ways in which the use of a specialist product may allow an appropriate solution for the customer to obtain a loan for their objectives.”

Pepper Money’s industry-leading loan approval time of just one day can be a strong selling point for brokers and their customers, Saoud says. “Ultimately, by helping a customer navigate a complex and at times highly emotional journey, you will earn their trust and have an advocate for life.”

Saoud says the non-bank lender partners with aggregators and brokers to deliver bestin-class training and targeted education events to help brokers learn about specialist lending opportunities.

Brokers are also kept fully informed of the “what, when and why” of every interaction throughout the loan process.

LENDER’S TAKE MPA: What do you need from brokers who are submitting a loan application?

David Verschoor and Greg Woszczalski, Grow Finance: We encourage brokers to actively embrace being the ‘go-to’ SME adviser and move towards being multisolution versus single-product providers.

www.mpamagazine.com.au

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08/03/2022 1:21:54 pm

FEATURES

MORTGAGE FRANCHISES

The network broking a better future Mortgage Choice takes aim at the top franchising spot with new technology, expanding opportunities and winning levels of franchisee support THE INTEGRATION of Mortgage Choice and Smartline has created Australia’s second-largest franchiser in the mortgage broking space, with almost 1,000 brokers across the country.

Two experienced brokers, Mortgage Choice’s Scott Partridge and Smartline’s Deb Smith, talked to MPA about the support the expanded broker network provides.

Scott Partridge had a glimpse of his own future when a Mortgage Choice franchisee helped him secure his first home loan.

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“I’d always wanted my own business, and I really liked the idea of helping people with the homebuying process,” he says.

His main concern was that his skill set might be too limited for the role.

“I’m not good at IT or building a brand at a corporate level, and I’m not a fan of managing the human resources side,” Partridge says. “I was very happy to discover that the Mortgage Choice support system was set up to provide help in all of these areas, leaving me free to do what I do best.”

The industry has transformed in the 24 years since Partridge bought his first franchise.

“Things are still changing fast, particularly in terms of IT, so support is as important as ever,” he says. “Being able to pick up the phone and have someone resolve any IT issues results in far less downtime and greater efficiency for my staff and I. Mortgage Choice also serves as a conduit of information about changes in lender and legislative requirements, so we can be confident about staying up to date.”

Partridge was just 26 when he opened a

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Sponsored by

Mortgage Choice office in Parramatta, western Sydney. He sold it nine years later to Crowe Howarth, spent the next nine years managing that business, and then, in 2016, decided to buy another Mortgage Choice franchise.

“I had the opportunity to join another group, but I’d seen the value Mortgage Choice adds to both running a business and, ultimately, the sale price when the time is right to leave,” he says. “I had no hesitation in choosing Mortgage Choice.”

Now based close to Parramatta in Sydney’s Hills District, his franchise has clients ranging from medical and IT professionals to tradespeople and teachers.

“I find it particularly rewarding when I can help people in difficult situations achieve positive outcomes,” he says. “I also enjoy building relationships. I’ve had the privilege of assisting first, second and even third generations of the same family.”

“Having a brand name that is immediately recognisable as one of the largest networks in Australia brings a level of trust that simply isn’t found among most of our competitors” Scott Partridge, Mortgage Choice That included setting me up with the right mentors, organising training with lenders, and showing me the best way to start prospecting my network.”

Smith also welcomed the opportunity to concentrate on her strengths.

“Smartline makes everything happen from a compliance, business insurance and systems perspective, which allows me to focus on getting outcomes for my clients,” she says. “This is what

I want to be doing and what I do best. I can trust the state and head office teams to know what needs to be done and to do it for us, such as making sure we’re meeting all compliance standards, have the right insurance in place and undertake whatever training we need to meet legal requirements in our business.”

After three years in Kew, Victoria, Smith decided on a tree change: she moved to the Macedon Ranges and set up an office in Wallan.

Making it happen Deb Smith’s journey as a broker began at Smartline, which along with Mortgage Choice is now owned by REA Group. Over the next 12 months, Smartline franchises will transition to the Mortgage Choice brand.

“I was ready to leave my corporate job in customer experiences and operations management to start my own business, but I had no idea what I wanted to do,” Smith says.

“My brother, a mortgage broker himself, put the idea on the table and suggested I gave this some thought. He knew I had always loved real estate and that I have a passion for great service and building great relationships.”

Like Partridge, Smith was unsure about having the right skills.

“I’ve always been relatively sharp with financial wellbeing but didn’t have a financial background,” she says. “Smartline was awesome. When I decided to take the plunge, I was on a hell of a learning curve, but they helped me to establish my business and ensured I had everything I needed for success.

REA GROUP: VIEWPOINT “Mortgage Choice, a nationally recognised and trusted brand for almost 30 years, now sits alongside Australia’s number one address in property, realestate.com.au. This places Mortgage Choice in an unrivalled position to directly benefit from REA’s highly engaged audience as well as its investment in digital capabilities and property insights.

“With more than 128 million visits to realestate.com.au every month, REA Group sees a significant opportunity to strengthen its experience for consumers by better connecting potential buyers to arguably the most crucial step in their property journey: financing the purchase of a home or commercial premises.

“There are exciting initiatives already underway to deliver stronger broker and consumer experiences. The loan tracker feature on realestate.com.au alerts homeowners when savings could be made on monthly repayments, or when there might be equity to unlock, providing more reasons to speak to a broker. Our strategic investment in Simpology has led to the launch of a new loan comparison experience, and we have also engaged in an open banking proof of concept with Frollo.

“At REA Group we are committed to changing the way Australians and the world experience property, and Mortgage Choice will play a vital role as it helps new and future generations achieve their homeownership dreams.”

– Janelle Hopkins, CFO and CEO financial services

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09/03/2022 8:22:21 am

FEATURES

MORTGAGE FRANCHISES

“Wallan is close to home, so it makes sense,” she says. “My business is built solely on referrals, so I have clients from all over Melbourne – mainly young people who are moving to the more affordable outskirts of the city. Many are buying their first home or building on one of the many lots of new land being released in the area.”

For Partridge, listening to the way others manage and grow their businesses has always encouraged new ideas, and a fresh approach is inspiring.

“We have forums on Facebook where we can share scenarios and seek advice,” he says.

“During COVID, our personal development

“When I decided to take the plunge, I was on a hell of a learning curve, but [Smartline] ensured I had everything I needed for success”

Leveraging success Both brokers are excited about the advantages of Mortgage Choice and Smartline joining forces and leveraging the best of the two businesses. Merging two cultures can be a major challenge, though in this case they proved to be a great fit.

“There’s camaraderie among the Mortgage Choice and Smartline teams,” says Partridge.

“Coincidentally, the franchisee who inspired me to join Mortgage Choice all those years ago later joined Smartline. Now we’re back on the same team.”

received in formal and informal settings.”

REA Group, which owns both brands, plans to create Australia’s leading franchise broking network by leveraging the best of each. For example, Mortgage Choice is one of Australia’s most trusted and recognised broking brands, with over 95% consumer brand confidence.*

Deb Smith, Smartline Personal Mortgage Advisers days have largely been online, but face-toface meetings are now back on the agenda.

Our annual conference is always a highlight, where relationships are built and input is

MORTGAGE CHOICE: VIEWPOINT “Last month Smartline and Mortgage Choice passed a significant milestone as we moved from planning to execution on our path to becoming one business. It’s an incredible feat as we bring together nearly 1,000 brokers under the Mortgage Choice brand.

“Smartline and Mortgage Choice have a rich heritage in this industry, spanning three decades, and over that time each business has shared the fundamental value of truly placing the client first.

“It’s this same value that provides our foundation for the future. We have always been real and relatable to our clients. We will continue to communicate with honesty, transparency and simplicity. Most importantly, we will continue to be the guiding stars for aspiring homeowners. These traits are some of the reasons why our owners took the brave decision to leave a bank and start up their own businesses so they could be all of this and more for their clients.

“Not only have we helped make the great Australian dream a reality for hundreds of thousands of clients, but we have also supported the creation of hundreds of incredible small businesses. As we turn the page and begin the story of our next 30 years, Mortgage Choice will continue to do what it has always done. We will support franchisees with the tools they need to deliver the best outcomes for their clients and build sustainable and successful businesses.”

– David Zammit, director – national sales

“Having a brand name that is immediately recognisable as one of the largest networks in Australia brings a level of trust that simply isn’t found among most of our competitors,” Partridge says.

By the end of 2022, all brokers at both companies will unite under the Mortgage Choice brand and will use Broker Platform, the purpose-built software developed for Mortgage Choice. For the past four years, its fact-find and file management capabilities, plus the ability to integrate with multiple systems, have been helping brokers increase their productivity and create better business outcomes for themselves and their clients.

Brokers will also be able to link to REA’s digital capabilities, property insights and highly engaged audience, making Mortgage Choice the leading proposition for anyone considering joining a franchise network.

Smith is looking forward to the changes.

“I’m sure adopting Mortgage Choice systems and processes will further hopefully streamline my business more,” she says. “Being part of REA Group will give us amazing insights into the real estate world with all their data.” *2021 Honeycomb REA Service Offering positioning research

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do your thing

08/03/2022 1:35:04 pm

SPECIAL REPORT

Australia’s top young brokers have brought more dynamism and resilience to the business

CONTENTS

PAGE

Feature article .............................................. 62 Methodology ................................................ 63 Rising Stars 2022 ........................................ 65

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SPECIAL REPORT BUSINESS STRATEGY

RISING STARS 2022

NEW ENERGY FOR THE INDUSTRY THE SHAPE of the home loan lending industry in Australia continues to evolve with extensive structural change taking place in the last 12 months.

One of the developments is National Australia Bank’s agreement with Citigroup to purchase the latter’s Australian consumer business – including its mortgage and unsecured lending books – for approximately $1.2bn, according to reports by mortgagebusiness.com.au and other sources.

Official mergers were also announced between the Firefighters Mutual Bank and Firefighters Credit Co-operative in May, and between the Teachers Mutual Bank and Pulse Credit Union in November 2021.

Several other major lending institutions, including Heritage Bank, Newcastle Permanent and South West Credit Union, are said to be contemplating mergers.

Due to the surge in housing prices, Westpac and the Reserve Bank of Australia announced their decision to tighten their lending policies.

Retail banks have increased fixed mortgage rates from their trough below 2% to cover their costs, and a further official increase is expected, reported the Sydney Morning Herald. Citing ANZ senior economist Felicity Emmett, the SMH report stated that fixed rates could rise slightly before stabilising, after three-year rates rose more than 80 basis points over the last few months of 2021.

The Rising Stars featured in this report have had to contend with even further adjustments because lockdown periods meant that broker accreditations issued by banks were not always processed within the usual timeframe, leaving some applicants awaiting their authorisation for extended periods.

Danielle Pierre, Mortgage and Finance Solutions

The spotlight on new talent

RISING STARS BY GENDER

10

15

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“I set this award as one of my goals when I sat down with my mentors, but my biggest accolades have been the feedback I receive from my clients”

Twenty-five exceptional mortgage professionals, all aged under 35, have made their mark in the industry during a period of unprecedented uncertainty.

Exceeding expectations and eclipsing their competitors, the Rising Stars have all written more than $15m in loans over the last 12 months after working as accredited brokers for only two years and made the proverbial lemonade from lemons during the pandemic.

Lee Hao (Jiangshan) of AUSUN Finance is a shining example of an individual possessing the imagination and tenacity

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FROM THE SPONSOR We are honoured to once again sponsor Mortgage Professional Australia’s Rising Stars report in 2022. As one of the first digital banks to invest in the broker channel, ING has always championed its growth and longevity. We know that for a sustainable mortgage broker industry, it’s essential that young entrants continue to enter the industry and build their careers.

As 90% of ING home loans originate via the third-party channel, brokers are not merely a distribution channel for ING but an integral part of our business.

The Rising Stars in this report exemplify the traits of a successful broker: customer-focused, driven, dedicated and resilient. ING is committed to supporting the development of such young talent in the broker market.

In 2021, we have seen an evolution in how mortgage brokers operate.

The pandemic has taught us to be flexible and able to adapt to a changing environment. This is exactly how the Rising Stars have demonstrated their ability to grow amidst the challenges.

They demonstrate the qualities of top performers and will continue to thrive.

“Although our office had been closed intermittently and not fully operating, Lee Hao continued to contribute by promoting the company, training new interns and opening the new branch” Jun Sun, AUSUN required to make this prestigious list.

“Although our office had been closed intermittently and not fully operating, Lee continued to contribute by promoting the company, training new interns, and opening the new branch. Lee obtained his broker accreditation in January 2021. However, with most of the country under lockdown, he did not receive his accreditation from banks until much later. Under such circumstances, Lee still managed to settle nearly $25m in total.

He proactively used online meeting software and social media to engage potential business referrals and ensure business pipeline growth,”

says AUSUN founder and managing director Jun Sun. This resilience in the face of adversity is a common trait among the Rising Stars.

“As a driven individual, goals are important to me,” says Danielle Pierre of Mortgage and Finance Solutions. “I set this award as one of my goals when I sat down with my mentors, but my biggest accolades have been the feedback I receive from my clients, for example, ‘We will definitely keep you in mind for any of our future needs and would absolutely recommend you to friends and family’; ‘Wow! A broker that follows through and does

It gives me great pleasure to recognise the achievements of the nominees in MPA’s Rising Stars 2022 and to celebrate their hard work and dedication to the industry.

Congratulations to the Rising Stars and all the nominees.

Glenn Gibson Head of Customer Experience, Service and Distribution ING

METHODOLOGY Mortgage Professional Australia invited the most impressive mortgage companies in the country to nominate high-performing achievers for the 11th annual Rising Stars (formerly Young Guns) list.

All nominees must be 35 years old or under, must have written more than $15m in loans from 1 October 2020 to 30 September 2021, and must have worked as accredited brokers for no more than two years.

Brokers presented their submissions to MPA, detailing why each individual deserved to be considered, and recommendations were then taken from their peers to decide who made the final cut.

After thoroughly reviewing all entries, the MPA team narrowed down the list to 25 Rising Stars who have made the most significant impact on the industry through their financial results, determination and drive.

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SPECIAL REPORT BUSINESS STRATEGY

RISING STARS 2022

Business with a social purpose

RISING STARS BY LOCATION

VIC

10

NSW

9

WA

3

QLD

2

SA

1

“My transition into mortgage broking was fuelled by [the intention to help] as many Australians as possible” Steven Brent Korner, Glass Financial Group

what she says she is going to. We couldn’t be happier’; and ‘Give Danielle a raise, please!’”

Another winner, Jennifer Campbell, achieved Elite Broker status in her first year as a broker with the Loan Market Group, exceeding all the requirements for the category. Her exemplary standards saw her receiving a net promoter score of 99 and multiple Google reviews, all while welcoming her first child into the world in May 2021.

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The pandemic has undoubtedly created a shift in societal priorities. On close inspection, the motivations of this year’s finalists have proven every bit as admirable as their economic success.

Shubham Bhaskar of Sheel Capital has submitted $52m in loan applications. These requests were made up of commercial property investments, restructuring of mediumto-large-size investment property portfolios, and first home buyers who wanted to make the most of the low interest rates.

Bhaskar, however, believes in sharing not only knowledge but also material wealth.

He has already donated $2,000 to a not-forprofit organisation in the last six months and plans to donate a further $8,000 before the end of the financial year.

Steven Brent Korner of Glass Financial Group previously worked in financial planning. After switching to broking, he has assisted close to 100 people in buying their first home during a turbulent year and echoes many of his contemporaries’ sentiments.

“I became a broker because I really wanted to help people change their lives. I left being a financial planner because I felt like the fees we were charging were too expensive and [therefore] I wasn’t able to assist the average person to achieve financial freedom. My transition into mortgage broking was fuelled by this – to ensure I can help as many Australians as possible,” he says.

Mat Kirk, finalist from Empower Wealth Mortgage Advisory, agrees with Korner, revealing that his career goal is to ensure his clients are “safely secure in their dream homes” and to “help many more Australians become financially free”.

Contemplating her future in the industry, Danielle Pierre adds: “I just want to look back on my career, when I retire, and have thousands of clients say ‘Danielle really cared about me’.”

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Shubham Bhaskar Founder and Director Sheel Capital

Sabrina Huang Director Smart Mortgage

Phone: 0408 456 777 Email: shubham@sheelcapital.com.au Website: sheelcapital.com.au

Phone: 07 3195 7299 Email: sabrina.huang@smartmortgages.com.au Website: smartmortgagebne.com.au

Adam Piper AXTON Finance

Leah Hutchinson MoneyQuest Cronulla

Andrew Hadjidemetri Australian Financial and Mortgage Solutions Ansh Sethi Mortgage Domayne Blake Murray Blue Crane Capital Danielle Pierre Mortgage & Finance Solutions Danny Alvarez Simplicity Loans and Advisory Edward Taffa Shore Financial Elliot Hitchen Bespoke Finance Group Eva Loisance Finni Isabella Constantinou Simplicity Loans and Advisory

Lee Hao (Jiangshan) AUSUN Finance Luke Simon Rowland AXTON Finance Mat Kirk Empower Wealth Mortgage Advisory Melissa Long Empower Wealth Mortgage Advisory Michelle Della-Vedova Napoleon Finance Nigel Ferreira MoneyQuest South Yarra Nittaya Phommachack Entourage Finance Peter Jin Keylend

Jamie Currie Preferred Private Lending

Rachel Eveson Bell Partners Finance

Jennifer Campbell Loan Market

Steven Brent Korner Glass Financial Group

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09/03/2022 11:47:23 am

FEATURES

COMPANY VALUES

Defining what your business stands for Businesses should not be purely about profit – they need a higher purpose that demonstrates their core principles, argues Carolyn Butler-Madden

PATAGONIA, TESLA, Zambrero, Intrepid Travel, Outland Denim, Future Super, felix mobile, Zero Co. What do all of these businesses have in common?

They are part of a growing movement of purpose-led businesses. Patagonia and Tesla are well-known global role models, and the others are all Australian-born businesses that are leading with purpose. It’s happening across industries – from financial services and insurance to retail, fast food and fashion.

Purpose has entered the mainstream.

What does it mean to be purpose-led?

At the highest level, purpose-led companies are literally in service to their purpose. Their commitment drives them to be leaders, activists, educators, facilitators, change-makers, collaborators and innovators. Profit is the outcome, not the driver. They will leave money on the table if it conflicts with their purpose.

Yet they financially outperform companies without a higher purpose and companies with a passive purpose statement, according to the Global Leadership Forecast 2018 report.

Driving profit through purpose is more than a mantra; it’s a reality, and it’s shaping

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a new generation of business leaders and the promise of a better future. To understand this better, let’s take a closer look at a couple of home-grown purpose-led businesses.

Outland Denim: Empowering vulnerable women through jobs, training and opportunity In October 2018, on an official royal visit to Australia with Prince Harry, Meghan Markle, Duchess of Sussex, stepped out in a pair of elegant black, high-waisted stovepipe jeans from a small Australian denim company called Outland Denim.

Founded in 2011, Outland Denim’s aim was to give victims of sex trafficking in Cambodia a place to learn new skills, start afresh and support their families without fear. Headquartered in Australia with a training and production facility in Cambodia, it invests in the personal development and wellbeing of its employees. What started as an avenue for victims of sexual exploitation to engage in safe, dignified employment as they rebuilt their lives has since widened to accept employees from varying backgrounds of vulnerability and exploitation.

The ‘Meghan Markle effect’ gave the brand millions of dollars in free publicity, which raised its profile globally, and it went on to outsell many household-name brands. But it’s the combination of the brand’s stylish elegance, the story of why it was founded, and its ongoing social and environmental impact that makes it such a potent and compelling story and an inspiration to other businesses.

Intrepid Travel: We want to be the best travel company for the world Intrepid Travel was founded with a goal to create a style of travel that could benefit both travellers and the places and people they visit.

Responsible travel.

Intrepid is about travelling the local way. It uses local accommodation and transport; its travellers eat in restaurants owned and run by locals, and it uses local tour guides. Not only does this give travellers an authentic local experience, but it also means their money is spent with locals, benefiting local communities.

Over the years Intrepid has advocated on issues such as climate action, animal welfare, child protection and gender equality. It was the first global tour operator to end elephant

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rides – a risky decision, but doing the right thing not only helped grow the business but changed the industry.

By 2019 it had achieved its fourth consecutive year of record financial results. Then the pandemic hit and Intrepid went to zero revenue almost overnight.

During a period of hibernation, Intrepid built on its work in animal welfare tourism and sustainability. It open-sourced its own animal welfare policy and toolkit for other tour companies to use. It also published its 10-Step Quick Start Guide to Decarbonise Your Travel Business. Intrepid Urban Adventures (Intrepid’s day-tour brand) pivoted, offering

Driving profit through purpose is more than a mantra; it’s a reality, and it’s shaping a new generation of business leaders online experiences that provided customers with a way to travel while staying at home.

This action also helped support tour guides while tourism was on hold.

Intrepid’s strategy is to grow with purpose.

It aims to become the world’s first purpose-led billion-dollar travel company by 2025. It is not shy in its desire to be profitable. Its leaders recognise that profitability is essential for

them to realise their ambitions to be the best travel company for the world.

As the movement towards purpose-led business grows, it’s important to understand that its success is being driven by the market.

Employees, consumers and investors are demanding change. Purpose-led businesses are responding to these demands. And to society’s needs.

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FEATURES

COMPANY VALUES Why purpose must be led from the top The topic of purpose has been trending for long enough now that the conversation has shifted from whether purpose is important to ‘how’ an organisation discovers and embeds its purpose within the business. This begs the question, who should lead this work?

Some might argue that this is the role of HR, because purpose must be owned first and foremost by your people. The brand team might champion the importance of the role of brand in a purposeful organisation, not just to its external customers but also internal ones: your people. Your CSR team may also fight for a look-in, highlighting their work in building strategic partnerships with impact organisations that are making a meaningful difference.

purpose your organisation serves is inconsistent with what your purpose statement articulates. Therefore, you either have the wrong purpose statement, or if your leaders are not aligned with that purpose, they are the wrong people to bring it to life. Either way, this misalignment is likely to impact negatively on the organisation.

Having a purpose statement vs being purpose-led The Global Leadership Forecast report found that getting purpose right builds organisational resilience and, crucially, improves long-term financial performance. It found that the real benefits come when leaders exemplify their organisation’s purpose.

Of 1,500 global C-suite executives surveyed,

In a disrupted world, purpose is the North Star: a fixed point to help you navigate through change and uncertainty The reality is that all these perspectives are true. Each of these stakeholders needs a seat at the table when it comes to uncovering your organisation’s higher purpose and building your purpose strategy. In fact, the entire executive leadership team should be involved.

Most importantly, however, the CEO must be at the head of the table. Without the CEO leading on purpose, it loses relevance, because it signals to everyone else that the CEO and board do not consider it to be the key driver of organisational strategy.

84% said their business operated in an increasingly disrupted environment. In a disrupted world, purpose is the North Star: a fixed point to help you navigate through change and uncertainty.

The Global Leadership Forecast identified three types of organisations: 1. Those without a purpose 2. Those with a purpose statement 3. Purposeful organisations in which leaders bring the stated purpose to life through behaviours

performance? The key advantages included: • a significantly stronger culture with higher levels of psychological safety • higher engagement levels and intent to stay • higher agility • higher levels of trust and loyalty, leading to more resilience when the going gets tough.

This impacts on retention of customers, employees and shareholders in times of crisis and transition • having a broader vision that serves all stakeholders and aspires to improve society gives purposeful organisations an advantage in their ability to identify risks and unexpected opportunities • purposeful organisations create a culture of coaching and development and cultivate better leadership

Societal leadership a core business function Society is experiencing a crisis of leadership. Trust has collapsed in democracies around the world. Yet there are hints of optimism. According to the 2022 Edelman Trust Barometer, businesses and NGOs are the only institutions considered both ethical and competent, with the ability to act as stabilising forces. “My CEO” is trusted, alongside “my co-workers”. Societal leadership is now considered a core business function.

By embracing their role as stewards of their organisation’s purpose, leaders will deliver on society’s changing expectations of them. They will be better able to navigate their organisation through difficult times, positioning their businesses well for the future.

Wrong purpose or wrong leaders?

Purpose can no longer just be framed as a passive context for what you do in your business. It is equally about identity and human endeavour: who you are and how you show up for the common good.

So, if your purpose does not drive your business strategy, you cannot claim to be a purpose-led organisation. You may have a purpose statement, but your organisation is not led by its stated intention. The true

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The report found that companies in the third category were earning a significant performance premium. Based on their financial performance, companies with a purpose statement performed at the average (mean) of the organisations surveyed. Companies without a purpose statement underperformed by 42%. Purposeful companies outperformed the average by 42%.

How does being purposeful deliver stronger

Carolyn Butler-Madden is the author of two books on social purpose, For Love & Money and Path to Purpose. She is a purpose specialist and a passionate speaker on this topic.

As chief purpose activist of her consultancy, The Cause Effect, Butler-Madden helps leaders define and embed purpose strategically into their businesses and brands to deliver meaningful impact – Profit with Purpose. Learn more at www.thecauseeffect.com.au.

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08/03/2022 12:32:27 pm

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PEOPLE

BROKERAGE INSIGHT

Simple solutions, best results With years of commercial banking experience, Luke Heavey decided his talents would be better served by a brokerage of his own – and he’s never looked back

LUKE HEAVEY, the senior finance director at Orium Finance, has come a long way in his career.

The keen rugby player and fishing and diving enthusiast worked in commercial banking at BNZ in New Zealand for several years before moving to Sydney in 2013, where he joined NAB as a business banker covering the Northern Beaches.

“Then I went to a BDM role within NAB looking after AFG, and that was my grounding and exposure to the broker space, and I was

are we doing this for a bank when we can do it ourselves through the broker model?’”

Heavey set up a brokerage with a couple of other brokers, but after a few years they decided to go their separate ways.

“I wanted to stay local within the city. Most of my clients are high-net-wealth accountants based in the city, so I wanted to stay where the fight was and grow my client base.”

Three years ago, Heavey joined forces with Dave Hancock, who had already set up Orium Finance.

“We have well over 20 years’ lending experience that we implement every single day to execute our financial solutions” really successful at that,” Heavey says.

He then worked as a private banker at BOQ Specialist, where his task was to grow the bank’s accounting arm with a client base specialising in medicos.

“We implemented and grew a portfolio of accountants, and then I said to myself, ‘I’ve got this thing off the ground, and I own all the relationships, and the bank’s making all the money off me’,” Heavey says. “Then me and couple of other guys said to ourselves, ‘Why

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“He was looking for someone to join the business and take it to that next level, and we started with a coffee and the rest is history.

“We have well over 20 years’ lending experience that we implement every single day to execute our financial solutions for our clients to get the best possible outcomes.”

Orium Finance focuses on working with financial planners and accountants to achieve wealth creation for clients, and on “maintaining lifelong relationships to help secure

multiple properties”. Its client base includes “typical mums and dads looking for their first property purchase or investment property” – they make up about 60% of the loan book.

“The other 40% would be our high-networth partners working at Deloitte, Ernst & Young and RSM Bird Cameron, along with another few big banking clients,” Heavey says.

In terms of attracting new business and building client relationships, he says Orium Finance has a full-time marketing executive who has developed the brand and promotes it.

“We do a lot of articles that we send out to our existing client base. We don’t generate too much from internet leads; we try to organically grow with our clients referring their friends and families and their professional networks.”

Orium Finance concentrates on meeting high standards, providing a detailed, seamless process and offering clients an excellent experience, Heavey says.

“We pride ourselves on educating our clients along the way so they know exactly what’s going on. We’re very transparent with our processes. We want them to understand that the solution we provide will ultimately put them in the best position to create wealth.”

Heavey says he gains a lot of lead generation from marketing to a wide client network.

By looking after applicants personally

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ORIUM FINANCE AT A GLANCE Owners: Luke Heavey and David Hancock Location: Sydney CBD Year founded: 2016 Services offered: Home loans, investment loans, refinancing, commercial loans, car and asset finance. First home buyers and mum-and-dad investors make up 60% of loan book; high-net-worth clients, such as accountants, comprise 40% Number of employees: 5

“We pride ourselves on educating our clients along the way so they know exactly what’s going on” throughout the process and ensuring they have a good experience, he gives them the confidence to refer Orium Finance to others.

Heavey says the brokerage quickly adapts to changes, helping clients understand why banks sometimes alter their processes.

“This creates more of an understanding and more of a relationship,” he says.

Orium Finance took a proactive approach to communication during COVID, and Heavey says he personally called clients for three reasons: “one to check in, two to see if we

could help, and three to see if they were looking to expand, or did they want to take advantage of a better interest rate putting them in a better financial position”.

“We do have a client-first approach,” he says. “It’s not the size of the deal or what that deal looks like – it’s about what is the best outcome for the client.”

Looking at risks ahead in the mortgage market, Heavey wants to see higher barriers to entry. He says “the biggest risk is other uneducated people in the market letting customers

down, giving them products they don’t need”.

While compliance regulations are a good thing, he says, he doesn’t want brokers to be burdened with the same level of reporting and regulations as imposed on financial planners.

“Coming from a private banking background, I really love simplifying what seems to be complicated, taking out all the fluff, just being completely transparent,” Heavey adds.

His private banking clients often operate through trusts and other structures, some of which they find daunting and complex.

“It’s about having a very simple conversation where they trust me to go and get the best possible result. I’ve had a lot of success with the private banks. I probably settle $35m with them per year with those exact scenarios.”

Heavey also enjoys the challenge of taking on residential loan customers who have been rejected by a bank and helping them “buy the house they thought they couldn’t have”.

Orium Finance is enjoying rapid loan growth and looking to continue that momentum and bring on new referral partners.

“I’m quite proud of where we started and where are at the minute,” Heavey says.

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PEOPLE

OTHER LIFE

TELL US ABOUT YOUR OTHER LIFE Email antony.field@keymedia.com

“ Micro donkeys a re only considered micro if they sta nd below 30 inches to the wither. Micro is a tru e breed, not a genetic modification”

5

No. of years since Katrina Rowlands started breeding micro donkeys

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Peak herd number of donkeys at Rowlands’ property to date

13

No. of new peafowl babies born this year at Rowlands’ aviary

A BROKER’S TRUE LOVE Katrina Rowlands, of Mortgage Success, helps homebuyers achieve their dreams, and in her spare time gives micro donkeys and peafowls a home KATRINA ROWLANDS, who has been a mortgage broker for almost 25 years, says her “true love and hobby is breeding and keeping micro donkeys”.

Rowlands began breeding donkeys when she and her husband bought a stunning 25-acre property 35 minutes inland from Byron Bay. Well fenced with complex growth trees, the property was perfect for

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raising free-range animals, and following an equine vet client’s advice, Rowlands chose micro donkeys.

“I love them for their individual characters, their beautifully affectionate nature and their intelligence,” she says. “They also have very playful characters and are very easy to manage and care for … they are the most gorgeous animals to cuddle.”

Rowlands’ other love is peafowl breeding. Her main aviary is now double what it was two years ago. Her peafowls come in different colours – blue, white, pied, split to white, and cameo.

“The beauty of all the colours is undeniable, and they also are easier to care for than many of their counterparts in my opinion,” Rowlands says.

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In your corner.

And your customers’.

Count on us.

For over 25 years, Australian brokers have counted on Suncorp Bank to help deliver home lending solutions to customers.

And your customers can count on us to offer competitive, flexible loans backed by the personalised service you’ve come to expect.

That’s the Suncorp Spirit Visit businesspartners.suncorp.com.au or contact your Suncorp Bank BDM

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