The Bank of China has signed an agreement with AFG to distribute home loans through the third-party channel.
The Adviser can report that as of today, the first tranche of AFG brokers will be able to offer Bank of China mortgages.
It comes after The Adviser revealed in August that new lenders were likely to enter the third-party channel.
AFG’s state manager for NSW and ACT, Stephen Doyle, said the aggregator already offers its brokers an extensive suite of products from all the major Australian lenders.
“However, we also understand the need to ensure that our offering is at the forefront of current and future market trends,” he said.
“We have witnessed a significant increase within the overseas investment channel predominantly from China and can foresee this trend continuing.
“The agreement with the Bank of China will create an important gateway into the Australian property market through a large Chinese banking institution,” he said.
AFG said the agreement will allow brokers an opportunity to access a lender that understands both the Australian mortgage market and Chinese investment market.
“We are confident that our brokers will be excited by the prospect of having direct and easy access to the Bank of China through our award-winning Flex system,” Mr Doyle said.
The Bank of China has a dedicated team of BDMs available for AFG brokers, which is expected to grow in time and in line with business volumes.
Bank of China first launched its own branded home loan products in 2006 and has witnessed solid loan portfolio growth since then.
This was achieved through a range of distribution channels including bank branches, a panel of mortgage referrers and its own brokers.
“We believe the broker channel brings significant advantages in terms of our business diversification and distribution as well as enlarging our market share so as to generate robust growth and diversification of our retail lending book,” a Bank of China spokesperson said.
“Furthermore, our selective use of mortgage brokers has assisted the bank gain a broader understanding of the local market enabling us to bring more attractive products and services to all borrower types across Australia,” the spokesperson said.
[Related: Bank of Sydney to enter third-party channel]