One of Australia’s challenger banks is aiming to access three-quarters of the mortgage broker market through the rollout of its new home loan offering.
Bank of Queensland (BOQ) CEO and managing director Jon Sutton told shareholders at the bank’s AGM yesterday that the launch of Virgin Money mortgages earlier this year is proving to be a significant driver of residential mortgages for the group.
“At the time of our full year results, Virgin Money had received $100 million worth of home loan applications,” Mr Sutton said.
“Virgin Money has been a great acquisition for us. It is a powerhouse brand that attracts a new and different customer than BOQ traditionally would. This is helping us to diversify our customer base and distribution channels,” he said.
“We have the brand rights for the next 37 years and see lots of opportunity as we continue to evolve the product offerings underneath this brand with a deposit product to follow shortly,” Mr Sutton said.
“We’ll continue to mature our multiple distribution channels by further building out accredited brokers for Virgin Money which when combined with BOQ’s existing broker channels, will give us access to 75% of the broker market.”
In 2016, BOQ delivered an increased profit for a fourth successive year. Cash earnings after tax increased to $360 million, up $3 million from the prior year.
Mr Sutton noted the emergence of new online players in the Australian mortgage market over the last 12 months and believes BOQ is well positioned to benefit from new digital partnerships.
“The number of fintech start-ups are also growing by the day, as technology creates opportunities for disruption across different parts of the value chain,” he said.
“We see this as an opportunity to partner with fintechs and to accelerate our digital enablement.”
Bank of Queensland was one of the “foundation lenders” to partner with online mortgage platform Joust earlier this year.
[Related: Virgin Money broadens distribution footprint]