Club Financial Services (Club) today announced the acquisition of franchise-operated mortgage brokerage The Mortgage Bureau.
The acquisition, according to Club, is part of a strategic move to strengthen its distribution channel and ensure continued growth.
Club CEO Andrew Clouston told Mortgage Business the acquisition offered the opportunity for Club to expand into a nationally recognised network.
Club, which is both a mortgage manager and brokerage, will now distribute its own-branded products via The Mortgage Bureau.
“The main strategy is to focus on the franchise model across the business and to grow this nationally,” he said.
According to Clouston, there have been no firm decisions yet in terms of how the businesses will be branded moving forward, “but a sole brand would seem to make sense.”
The new entity will have a combined loan book approaching $3 billion. 30 existing Club loan writers will also be given the opportunity to become franchise owners.
The move to increase its network represents a changing lending climate and the needs of borrowers, said Clouston.
"Mortgage managers will need to look at finding niche areas in order to survive as competing in the mainstream becomes increasingly less viable," he said.
"Alternatively they [mortgage managers] will have to look at diversifying their product range or move into other areas such as financial planning."
If more acquisition opportunities were to arise Clouston said Club is “certainly willing to look at them”.
Ron Guthrie, founder of The Mortgage Bureau, will step away from the business and “pursue other interests”.