Major broking groups have held the crown for consecutive years in The Adviser’s Top 25 Brokerages list, and 2020 was no exception. However, several independent offices are holding their own, creating competition in the sector.
Last year, the broker channel demonstrated resilience and strength through the upheaval and change of the royal commission and ongoing changes, as demonstrated in the Top 25 Brokerages ranking.
The big brands continue to hold sway in the broking market. Aussie Home Loans and Mortgage Choice maintained their top two positions, a trend that has remained for several years, while the Loan Market Group maintained its third position for the third year in a row.
However, several independent offices gave the big groups a run for their money.
Sydney-based 1st Street Financial returned to the list after two years, finishing in the top five in the rankings. The firm has a total loan book of $5.9 billion and broker productivity of $63.8 million, despite having only 14 brokers and five support staff.
Victoria-based Buyers Choice Mortgage and Finance achieved a top five ranking for the first time after it jumped two places from last year’s rankings. Meanwhile, Sydney-based non-franchise firm Catalyst Advisers achieved the highest broker productivity, hitting $174.6 million with only four brokers and two support staff.
The Adviser spoke to some of the top-ranked firms to find out their formula for success.
The 28-year-old broking group has clinched the top ranking once again in 2020. CEO James Symond explains how brand and culture are two key ingredients for their success.
You have maintained the top ranking for many years now. What do you think is behind the success and the consistency?
We’re just 28 years old, and we’ve been doing this for a very long time. In conjunction with a trusted household brand, we have amazing team members who are a key part of building high-quality culture. Culture is everything to Aussie. Having the right environment and the right people is key. Our strategy for growth is to continue surrounding our brokers with a supportive team. We have a “one team” vision across Aussie. We achieve this culture through deep levels of engagement, transparency and strong partnership. This support encompasses a range of activities, including strong marketing programs and technology, for our brokers to act in the best interests of customers at all times.
What was Aussie’s biggest achievement in 2019?
To be perfectly honest, I think Aussie’s biggest achievement was probably the industry’s biggest achievement – navigating through a very challenging real estate marketplace and a very challenging regulatory marketplace. The theme of 2019 has been agility, being able to react quickly to market changes and navigate a changing regulatory environment. Over the past year, Aussie has been working closely with government to ensure a strong brokering industry, which always puts the customer first.
I think that communication with government at all levels has been key for us and the industry: communication with our team members as to what is happening, what steps we’re taking, and how they can participate as well in educating both government and the consumer.
What was the biggest initiative you took in 2019 to make writing loans more efficient?
Last year alone, we ran nearly 300 individual training sessions across the country for various things. We relaunched our brand with our simple yet sophisticated marketing campaign of Go Straight to Aussie so the consumers are not confused. For us, it’s about getting to the consumer directly and as soon as they are thinking about buying a property. That’s really helped us in terms of the number of enquiries that have come to Aussie over the last six months in particular. Recognising that the application process is such a key moment for our customers, the tip of the iceberg for us right now is the introduction of new technologies and online tools for our brokers. These will save customers the time and effort, particularly when it comes to serviceability and documentation.
In what was a challenging year for brokers, Mortgage Choice saw some changes of its own, including the appointment of Dean Thomas as its new chief advice officer, and enhancements to its broker platform, as CEO Susan Mitchell outlines.
What do you attribute Mortgage Choice’s success to?
Brokers across the industry felt the weight of uncertainty on their shoulders in 2019 as their livelihoods were threatened. What I’m most proud of is that when we faced this adversity, our network pulled together. The executive leadership team, head office staff and our franchisees actively fought not only for our future, but for the future of our industry. I saw members of our network meet with local MPs, lobby for the industry and do everything in their power to demonstrate their value proposition to customers.
What was Mortgage Choice’s biggest achievements in 2019?
We delivered our loan origination software, Mortgage Choice Broker Platform, just over a year ago. The broker platform was the foundation stone to revolutionise the broker experience, and the response from the network has been overwhelmingly positive. We have now taken Broker Platform to the next phase in its evolution and delivered a major enhancement, File Manager. File Manager is a workflow management tool, which triggers, tracks and enables the execution of tasks throughout the customer’s loan application journey. Our brokers reported a significant increase in productivity with the implementation of File Manager into their business processes.
What will the brokerage be focusing on in 2020?
From a compliance perspective, the business is actively focused on delivering to best interests obligations. This includes enhancing our technology and processes to ensure that our brokers can effectively demonstrate they have complied with this duty. Looking ahead, we are focused on digitising the loan application process by empowering customers to do more of the process themselves and creating time for our brokers to meet the ever-evolving needs of more customers, in more ways.
2019 was a busy year for Loan Market, as it voiced its position on clawback arrangements and launched a lead generation tool and a marketing automation program. Chairman Sam White elaborates on the firm’s achievements.
What was Loan Market’s most significant achievement in 2019?
After the year the industry had, with the uncertainty created by the royal commission, I’m thrilled to hear our brokers have the confidence that Loan Market will partner with them through ongoing change. That’s why I believe Loan Market’s biggest achievement in 2019 was being rated number one overall by brokers as the Aggregator of Choice out of 13 groups. This was done through the Momentum Intelligence industry-wide survey on brokers’ satisfaction with their current aggregator. We topped nine out of 14 categories.
What was the biggest initiative you’ve taken recently to make writing loans more efficient?
We became obsessed with automating marketing and lead generation, all integrated with our technology platform, MyCRM. We launched the Pay-Per-Lead Program and MyLead Generator, designed to find brokers clients, and combined that with the launch of Nurture Program and Stay-In-Touch, designed to keep clients. As a result, we’ve seen the emergence of the paperless broker who collaborates with their customers online. A client will only see paper upon signing the bank’s application form.
What will be your focus in 2020?
We will be focused on keeping our brokers safe in the changing best interests duty ecosystem. I know the vast majority of brokers are already working in the best interests of their clients, so this change won’t be drastic in terms of approach or attitude. The significant thing to change will be in implementing a new process to prove they’ve met the best interests duty for each and every client, each and every time. Loan Market will help prove best interests duty has been met with The Loan Market Way, a streamlined process that integrates fully with MyCRM.
1st Street Financial was the highest-ranked independent brokerage on the Top 25 Brokerages list this year, making a strong comeback after being absent for two years. Managing director Jeremy Fisher outlines the successes of the firm.
What was 1st Street Financial’s biggest achievement in 2019?
Our biggest achievement was supporting every broker to achieve their goals in 2019. Each broker set a goal in January 2019 and, with the support of the organisation, not only fulfilled it but, in most cases, overachieved. This ranged from settling more loans than the previous year, successfully receiving a referral from every client, maintaining 100 per cent conversion record for every loan settled, and being recognised in various industry awards and accolades.
What was the biggest initiative you’ve taken to make writing loans more efficient?
In 2019, we appointed two staff members offshore to assist the brokers with loan packaging and post-settlement management. This additional division has been a huge success. Productivity is the highest it has ever been, and outsourcing to specialists has meant brokers have more time to focus on their clients and individual needs. Our proven processes (which we have developed over many years) are followed with no room for error, ensuring there is no impact to our clients or lender partners, which is critical. In addition, there has been no disruption to our day-to-day business operation. As a result of increasing productivity, the brokers have achieved their individual goals of growing their portfolios – both with loan volumes and client retention/satisfaction.
What will the brokerage focus on in 2020?
1st Street Financial will be paying particular attention to pre-approval conversions. This will be activated through a number of successful partnerships with property-sourcing businesses. Buyer’s agents and 1st Street Financial have a clear goal to ensure clients’ needs are met. By marrying the two business functions, we will ensure our clients will be given high-level service to assist them in achieving their goal of property purchase.
The Victoria-based non-franchise group rose two spots in the ranking this year and recorded the highest total volumes in the 2019 financial year among independent brokerages. Director Brett Mansfield explains how the firm did it.
What was Buyers Choice’s biggest achievement in 2019?
The launch in October of our Australian credit licence was a significant milestone for us, and we are now seeing the benefits this has provided in enabling us to provide even greater support to our members. We are also expanding our lender panel to introduce access to niche markets. We also made a conscious decision based on our organisational culture to retain our compliance management in-house. This has significantly increased the frequency of touchpoints with our members, allowing us to deeply understand their businesses and help them achieve their desired outcomes.
What was the biggest change you made to ease the loan-writing process?
Following the release of the banking royal commission interim report, changes to lending standards and credit assessment had led to an increase in the time required for brokers to conduct client interviews and process loans. We identified it as a key issue driving a loss of efficiency and increased costs for all brokers. In response, we worked with industry partners to create a best practice process, workflow automation and integration of a seamless, cost-effective, loan-processing solution. Mortgage brokers have reported increased efficiency, which has freed up more time to spend in front of their clients.
What will be the focus for your brokerage in 2020?
Our operational focus in 2020 will be the ongoing enhancement of our best practice process to increase our members’ efficiency. We are reviewing our lender panel and aim to introduce additional solutions to our platform across regulated and unregulated lending products. Growth of our membership will come through a focus on the recruitment of new-to-industry brokers and also recently commenced brokers who are seeking the levels of support offered by Buyers Choice.
The Adviser's Top 25 Brokerages ranking 2020 is partnered by NAB.
Steve Kane, NAB's general manager, broker distribution, commented: "At NAB, we are genuine in our belief that the services provided by brokers to the Australian community are essential.
"Brokerages at the top of their game build strong customer relationships, provide personal service and help customers with some of the most important financial decisions of their lives.
"As the bank behind brokers, NAB is proud to be championing the great work of these Top 25 Brokerages who have brought home ownership dreams to life, or have fuelled business growth across the country.
"We know many consumers would find it challenging to navigate the complex lending environment without a broker by their side.
"For this reason, more consumers are choosing brokers, with the latest data from MFAA revealing that more than one in two Australians use a broker to find a home loan that’s right for them.
"While we expect change within the industry to continue, we believe the heart of the broker value proposition will remain unchanged with an enduring focus on delivering the best possible customer outcomes and enhancing competition in the market.
"NAB will continue to invest in the broker channel as a true indication of the value we place on this very important partnership, with a spotlight on professional development and educational tools to support vital change and improve professionalism.
"On behalf of NAB, I would like to congratulate this year’s standout brokerages for leading the way in their commitment to putting customers first and providing exceptional service," Mr Kane concluded.
How is the ranking compiled?
The Top 25 Brokerages ranking is based on figures from the 2019 financial year.
Each brokerage was asked to provide several business metrics from 2019, including volumes, number of loans written, years in business, overall book size, number of brokers, number of support staff and more.
The information published is based solely on what was provided by brokerages and has not been manipulated in any way by The Adviser.
How was the ranking scored?
The final ranking was determined by scores in six key areas: total book size, total loans selected in 2019, total volume of loans settled in 2019, book size versus years in business, total number of brokers and average broker volumes for 2019 (i.e. volume numbers divided by actual number of brokers).
Each of the brokerages that entered was given a ranking score in each category from 1 to 25 (1 being the best).
The six scores were then added to give a final overall score. The lower the score, the better the ranking.
Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.
Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.
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