ALIC has proven to be a powerhouse in investment lending and produced some of the highest-volume brokers in the industry. The Melbourne-based brokerage’s CEO, Jason Back, reveals how the group helps young brokers realise their full potential
How many staff do you have at ALIC?
We’ve got 43 staff in total, 13 of which are brokers.
What have been the greatest milestones of the last 12 months?
It has been a challenging year and hard to maintain our growth. We have fairly ambitious growth targets of around 20 per cent yearon-year and to continue to achieve that has been tough. Given all the changes from ASIC and APRA, our ability to continue growing has been our biggest achievement over the last 12 months.
What is your focus for the year ahead?
We will continue to focus internally. We run a training academy, and we are really looking to supercharge that and take our staff all the way through the business, from entry all the way through to broker. Our process takes around three to four years, which will get a broker up to writing around $50 million a year. We would like to cut that training time down to around two and a half or three years. That will be a big focus for us next year.
How has mortgage broking changed over the years?
The biggest change for us is around technology. That doesn’t mean technology is taking over; it’s about how we utilise tech to maximise efficiency. If you consider where a broker adds value, or where our industry as a whole adds value, it’s in human relationships and advice. It’s not by pushing paperwork around and it’s not by collating data. It’s in the advice piece. You need to look at how your processes allow you to maximise efficiency and spend more time talking to clients. That’s where the industry needs to start being an enabler. I think we are still struggling to find good technology that can be assimilated across the board that companies are happy to use.
This Sydney-based brokerage has grown significantly over the last few years and is the highest ranked new addition to our listing in 2018. Shore Financial CEO Theo Chambers explains what’s next for the ambitious brokerage
Shore Financial has built a loan book of $1.85 billion in under five years. What would you say are some of the keys to the company’s success to date?
Having a great team behind us. We trained a very positive and energetic team culture that made everybody work hard and drive good results.
The avenues where we originated our business are also important. We had that experience in real estate– driven referrals and leads, which we were successful at before starting the business. Teaching other brokers how to be successful at that was not something new for us. It’s that old saying, “If it isn’t broken, don’t fix it”. We just had to make a few tweaks, but basically, we have taught the same strategy of real estate–driven leads to our brokers.
How do you balance mortgage broking with managing a growing business and the responsibilities that come with a CEO role?
I’m still writing loans to maintain my existing book of clients and also to keep up to speed from a policy perspective. It is important to be across some of the frustrations our brokers feel and the changes that have impacted the industry.
You’ve previously announced that you will launch a white label offering later this year. How did you arrive at that decision?
White label was always a long-term plan for us. It wasn’t at the top of our agenda when we first got started, and I didn’t actually think I’d be looking at it this soon. But volume-wise, we are at the right level to start testing it.
An opportunity came up with a group of guys who had decent credentials and would be perfect to do it with. We raised some capital and invested in a new wholesale funding program, which is very different from traditional programs. Technology is the key change here. It involves algorithms for assessment and blockchain solutions.
My incentive is getting a different line of funding with a different pricing and policy offering. There hasn’t been much innovation in that area since the GFC. Now that the banks have pulled back, policy has tightened and there is an opportunity for us.
Up two places this year is franchise group Loan Market. We catch up with Loan Market executive chairman Sam White to find out why he thinks the group is on the rise.
What was Loan Market’s greatest achievement in the financial year 2017?
I will remember 2017 as the year Loan Market faced up to the issues and opportunities that were coming from all the inquiries that had started - especially with the ASIC review in full swing. Our franchisor team and our franchisees came together, looked at where we could improve, muscled up and worked hard to improve our business and our customer service.
We also were in full flow building our new broker and consumer platform MyCRM, which gives our brokers back time whilst ensuring they are complaint.
Why do you think brokers value Loan Market?
When it comes to what brokers value most, Loan Market offers high levels of support, training, leads, software, marketing, a large panel and diversification opportunities - but it’s the strong culture that we are most proud of.
Loan Market has always believed that, whilst brokers may be in business on their own, they should not be alone. Our brokers like supporting each other, learning from each other and challenging each other.
We’ve always respected the primacy of the franchise owner - we don’t lock people in, preventing them from leaving us. We believe we have to keep earning the right to be their franchisor. In this way, we have a culture of brand champions, not brand captives, and that is what our people value.
Why do you believe groups (such as Loan Market) are important to brokers in the current environment?
Right now, there are five areas that are important to brokers:
1. Care - brokers need a group that genuinely wants to help brokers grow their business;
2. Compliance - brokers want confidence they are doing everything right and their business is sustainable.
3. Time - creating more time through better systems and processes, a broker support team to create efficiencies and help recruiting and training their support staff.
4. More revenue - create diversified income streams in their business, either by entering financial planning (Loan Market has an AFSL business, Wealth Market) or partnering with a real estate office. 5. Experience to manage change - with all that's going on in the industry, brokers need a group that has experience in changing markets.
Mortgage Choice CEO John Flavell explains why a strong retail footprint is critical for this national brokerage
What have been some of the key milestones for the group over the last 12 months?
Mortgage Choice enjoyed a stellar 2017 financial year. The company grew its cash net profit after tax by 10.2 per cent, which marked the second consecutive year of over 10 per cent growth. In addition, we achieved our bestever settlement result, thanks to a combination of favourable market conditions and strong growth in franchisee numbers.
Throughout the 2017 financial year, we added 46 greenfield franchisees, which is the largest number of greenfields ever recruited in a single year.
We also launched a Mortgage Choice branded asset finance offering and bolstered our retail shopfront footprint. Finally, we added more than 50 branded cars to the roads. All of these served to enhance our national brand awareness.
How important is it for a group like Mortgage Choice to have a strong retail presence?
It’s very important. Mortgage Choice is an iconic, 25-year-old national brand that continues to resonate with Australians across the country, thanks to our strong marketing efforts, the exceptional skills of our franchisees and our ever-growing retail footprint.
The more retail shops we have across every part of the country, the more recognised we become as a brand and the better our brand awareness is with customers.
What are your plans over the next year?
We have ambitious plans for the 2018 financial year. We will continue to grow our broker numbers in order to have more feet on the ground to service the growing financial needs of our customers.
In addition, we are re-launching the company’s national website and giving our broker minisites an overhaul in order to make them more search and customer-friendly.
We will continue to imbed our diversified products and services and ensure that we continue down the path of becoming a one-stop shop for all of our customers’ property and finance needs.
We will also continue to enhance our software platforms in order to drive greater business efficiency.
Once again, Aussie has taken out the premier position in The Adviser’s Top 25 Brokerages ranking. We sat down with CEO James Symond to find out what the group has planned for the next 12 months
What sets Aussie apart from other major branded brokerages?
Aussie Home Loans is much more than Australia’s best-known mortgage broker brand. I believe we also lead the way in training. We excel at recruiting new-toindustry brokers and providing them with industry-leading learning and development programs. New or experienced brokers who join Aussie have a choice of business opportunities and a clear career progression pathway to suit their ambitions.
We also have a very comprehensive and unmatched support structure for our brokers, from sales and business coaching through to credit, marketing, compliance, product and technology support. We offer it all.
Culture is also a differentiator. Central to all that we achieve is the uniquely collaborative and supportive culture that Aussie has, with a focus on a one-team mentality, from our staff through to our brokers and on to our business partners.
The final differentiator that I’d call out is our focus on the customer. From the beginning, we have always been a business that tries to get the best outcomes for our customers and give them an incredible experience along the way. This hasn’t changed and, if anything, it’s only become more critical to the way we operate.
How has mortgage broking changed since the business began?
Mortgage broking has changed dramatically. From non-existent to a sophisticated, trusted and commonplace way for Australian 01 AUSSIE HOME LOANS home owners and investors to get a home loan, it’s been an incredible ride; although not without its challenges. Technology has been one of the biggest influences on the industry, literally changing the way we write home loans from a paper form 26 years ago to it now being completely digital. Regulation has seen dramatic changes to compliance requirements. And then there’s competition, with more and more lenders, aggregators and brokerages entering the field by the day, it seems. The landscape is vastly different, but one thing that hasn’t changed is our presence, success and continued focus on getting great outcomes for our customers.
What are the benefits of Aussie being owned by CBA?
The main benefit is that CBA is keen for us to retain our independence and run our own show. We’ve been doing pretty well for 26 years, and thankfully, they don’t want to mess with a winning formula. From a risk and compliance perspective, we’re already pretty solid. But we’re getting even stronger in this area thanks to CBA’s processes, and we can also leverage their relationships and supplier agreements to access better rates, which is a huge plus. Other than that, it’s business as usual.
|2018 RANK||COMPANY||CHANGE FROM 2017 RANK||BUSINESS STRUCTURE||LOCATION||NUMBER OF BROKERS||TOTAL SUPPORT STAFF||TOTAL LOAN BOOK (END OF FY17)||LOANS SETTLED (FY17)||BROKER PRODUCTIVITY (FY17)||TOTAL FY17 VOLUMES|
|4||Smartline Personal Mortgage Advisers||-||Franchise||VIC||312||39||$25,530,876,970||18,774||$18,217,511||$5,683,863,566|
|5||Oxygen Home Loans||4||Non-franchise||NATIONAL||36||3||$2,759,857,516||1,729||$26,391,942||$950,109,907|
|6||The Australian Lending & Investment Centre||1||Non-franchise||VIC||9||24||$2,830,805,000||2,033||$79,409,693||$714,687,237|
|9||KeyInvest Lending Services||2||Non-franchise||SA||83||7||$3,735,043,707||1,931||$6,592,985||$547,217,747|
|12||ACA Mortgage Solution Pty Ltd||NEW||Non-franchise||NSW||13||2||$2,028,204,077||533||$25,082,409||$326,071,319|
|13||The Loan Company||NEW||Non-franchise||WA||14||9||$1,651,346,000||842||$23,357,143||$327,000,000|
|15||RAMS Adelaide Central||NEW||Franchise||SA||5||3||$543,000,000||570||$39,834,253||$199,171,265|
|17||Axius Partners Pty Ltd||NEW||Non-franchise||NSW||4||4||$523,450,000||15||$130,862,500||$523,450,000|
|18||MO'R MORTGAGE OPTIONS||NEW||Non-franchise||ACT||2||4||$764,800,934||535||$83,685,163||$167,370,325|
|20||Astute - Melbourne City South/Gippsland||NEW||Non-franchise||VIC||4||13||$331,269,055||594||$37,552,308||$150,209,231|
|21||Mortgage & Finance Solutions Australia||1||Non-franchise||WA||4||11||$1,093,660,210||426||$36,296,482||$145,185,928|
|23||finweb Group Pty Ltd||NEW||Non-franchise||VIC||14||4||$407,646,182||756||$14,096,122||$197,345,713|
|26||Strategic Property Finance Pty Ltd||NEW||Non-franchise||NSW||7||10||$414,623,549||212||$20,676,624||$144,736,368|
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