Brokers will continue to be “extremely important” to the expanded BOQ Group, as it looks to grow its mortgage book and roll out a direct digital mortgage offering next month, the CEO has said.
On Monday (22 February), Bank of Queensland (BOQ) announced that it had entered into an agreement to acquire 100 per cent of Members Equity Bank Ltd (ME Bank) for $1.325 billion.
Under the proposed deal, which is expected to complete in the middle of this year (subject to regulatory approvals), the ME Bank name and offering would continue as a separate brand.
This would mean that BOQ Group would consist of three brands: BOQ, ME Bank, and Virgin Money.
Currently, approximately a third of BOQ loans are originated via brokers, while 75 per cent of ME Bank’s are written by brokers, and nearly all of Virgin Money’s come via third party.
As such, the MD and CEO of BOQ, George Frazis, told The Adviser that the broker channel was “extremely important” to the group.
Speaking to The Adviser following the announcement, Mr Frazis said: “We will be expanding our accreditation with brokers, if anything. It’s a channel we love, it’s a channel we really support and it’s extremely important to all of our three brands.”
He later stated: “If you think about what’s going to really drive our growth going forward, it will be to continue to provide an amazing service to our third-party brokers and aggregators.”
The CEO added that it was “really important” for the group to “help more Australians into their homes”, adding that the three brands provide “different segments in the Australian economy choice around that”.
He said: “If we think about how we actually approach [them], those different segments have different needs.
“So effectively, at BOQ, it does require more of a personal touch, and that’s why we have our owner manager branches, which are really important, but we also distribute through brokers, and that’s going well.
“Virgin Money is purely broker at this stage and, as you know, ME is primarily through broker channel. That importance will continue.”
However, Mr Frazis said the group hadn’t yet “tapped into the digital channel”, revealing that Virgin Money will next month launch a direct mortgage offering on the new Temenos platform, as the brand continues to reposition itself as a digital bank.
Mr Frazis said the new digital offering would be available via a “state-of-the-art new mobile banking app”, which would enable the group to then provide “services through a digital channel to all of [its] customer segments”.
“That’s going to form the core banking platform for the whole retail bank. It’s built to be multi-brand, so over time that’s another channel we can provide to each of those customers that choose to bank with either ME bank or Virgin Money, so we’re very excited by that,” he said.
[Related: BOQ to acquire ME Bank for over $1bn]
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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