The CEO of a major brokerage has said that he believes the broking industry is “going to get too hard for those who are not committed to it”, and has urged part-time brokers to either fully commit or “get out of the industry”.
When asked by The Adviser how brokers should be preparing their businesses for the upcoming final royal commission report and any potential changes coming off the back of it, the CEO of Aussie Home Loans, James Symond, said that “brokers should understand they can only control the controllables”.
“There is no use being worried about things that they are unable to control,” he said.
“In terms of what brokers can do to prepare though, they can run a good business. They can put their heads down, bums up, and see as many customers as they are able while giving amazing service; not just to new customers but also to existing customers that they are being paid a trail fee on to give regular health checks and ongoing communications.”
Mr Symond went on to warn that impending change would make it harder for brokers to work on a part-time basis, adding that he believed that those not working full-time should consider doing so or leave the industry.
He told The Adviser: “If you are a part-time broker, make a decision to either become a full time broker, or get out of the industry.
“The industry is going to get too hard for those who are not committed to it. You are either part of the solution or you are part of the problem. For me, being part of the solution is being 100 per cent committed as a professional mortgage broker in the Australian mortgage marketplace.
“This isn't a part-time thing, this is an all-time thing. We are going through a really hard time at the moment, and we are about to go through an even harder time in 2019.
“We will get through this as an industry. We will need to make changes as an industry and as a business, but we will get through this.”
The brokerage CEO added that there was plenty of action being done by broker groups, such as Aussie, to “speak to people at the highest levels”, including the federal Treasurer and the Prime Minister, to “make sure that nothing is done inappropriately that would damage the industry and to keep competition alive, versus the big banks”.
Moreover, the head of the broking franchise said he had been “really impressed” by the number of the leading brokerages and aggregation groups that have been running campaigns and speaking to local and federal ministers about the value of the broker channel and why commissions need to remain as they are.
“There are plenty of grassroots campaigns that are out there, so I think the message is getting out there and I think the message in the next two-three months in particular will get out there,” he said.
“Our role is to encourage the politicians to make sure that whatever they apply from the Hayne commission is set against benchmarks that are still great for competition and do not stifle the growth of mortgage brokers who have 55 per cent of market share because customers have wanted it that way.
“Customers have built the mortgage broking channel over the last twenty years and voted with their feet - so that something in itself. If you damage mortgage broking, all you do further strengthen the major bank hold on the sector,” he added.
The Aussie Home Loans CEO concluded: “There is no doubt that change is the one constant, in both life and in our industry. There is no doubt that our industry will be going through further change. Whether that is change of commissions, change of the panel of lenders, or credit criteria that is continuously getting tighter, change is that one constant and you just have to adapt to the change.
“Behind the scenes, we are working out plans and strategies that we can pull out depending on what those changes are. Whether it is a change in commission, if it is a change in credit criteria, if more lenders are pulling out, we'll be ready to react to those changes with our team, as they expect us to be, to ensure we keep running a sustainable business,” he said.
Annie Kane is the editor of The Adviser and Mortgage Business.
As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts.
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