Loan Market is to purchase NAB’s aggregation groups as the bank continues its “simplification” strategy.
National Australia Bank (NAB) has entered into an agreement to sell 100 per cent of its broker aggregation businesses – PLAN Australia, Choice and FAST – to Loan Market Group.
According to the major bank, the agreement follows its strategic review of the broker aggregation business and is in line with NAB’s move to simplify and focus on its core banking business.
Under the agreement, Loan Market will acquire 100 per cent of NAB’s three broker aggregation businesses, the corporate credit licence holder and compliance services provider (BLSSA), associated broker aggregation technology, including the technology platform Podium, and commissions systems and related sales and operation services.
However, the four businesses – Loan Market, PLAN Australia, Choice and FAST – would continue to run independently of one another, Loan Market Group has said. They will continue to have their own respective aggregation agreements, leadership, and corporate sales and marketing teams.
Through the transition, the brands under PLAN Australia, Choice and FAST will continue to be led by PLAN Australia CEO Anja Pannek, Choice Aggregation Services CEO Stephen Moore, and FAST Group CEO Brendan Wright.
Completion is subject to satisfactory customer obligations and NAB will provide certain warranties and indemnities.
Completion is expected to occur in early calendar year 2021.
It is not expected that the deal would have a material financial impact on NAB, the major bank said.
A significant milestone
Commenting on the purchase, Loan Market executive chairman Sam White said the purchase represented a significant milestone in the major brokerage’s history.
“We passionately believe in the mortgage broker sector; the competition brokers generate in the Australian finance sector and the value they provide customers. It’s no surprise that brokers settled six out of 10 home loans in Australia this year,” he said.
“We are thrilled to be welcoming PLAN Australia, Choice and FAST brokers and their teams into our group and look forward to working with them and supporting the next evolution of those businesses.”
Mr White added that the purchase would allow the group to invest significantly in technology and innovations, offer business owners more flexibility in business modelling, and the ability to share scalability benefits.
“The acquisition means we can offer more options to our members. It will empower our business owners to decide which value proposition and support structure they need to thrive,” he said.
“The scale of the purchase will also allow us to further invest in technology, innovation and compliance-driven tech to benefit more brokers and, importantly, their clients.”
Speaking of the acquisition, Ms Pannek said: “I’m thrilled with the opportunity this presents for our valued PLAN Australia members and the team. This will enable PLAN Australia to continue to deliver our leading premium aggregation offering and in doing so, partner and support our members in this dynamic industry, with the additional insights of the Loan Market Group.”
Mr Wright also spoke about the purchase, saying: “This opportunity will allow us to continue to support FAST brokers with a clearly differentiated value proposition for finance broking businesses in a rapidly evolving financial services landscape, backed up by the expertise and experience of the Loan Market Group.”
Commenting on Loan Market’s purchase of Choice Aggregation Services, Mr Moore said: “The White Family Group is a real Australian success story. It is a family-owned and run business with a fantastic culture we expect will resonate well with Choice members, and that aligns with our focus on providing exceptional service and support.”
NAB group executive personal banking Rachel Slade said NAB would continue to have a connection to the broker market through broker originated lending.
“We continue to look for opportunities to support the broking industry and serve our customers well. Brokers play a significant role in the lending market and in enabling access to credit for many Australians,” Ms Slade said.
“As the broker market evolves, it is the right time for us to exit broker aggregation and focus on lending at NAB.
“Equally, this agreement provides Loan Market Group with leading Australian broker aggregation groups, PLAN Australia, Choice and FAST, industry-recognised expertise in residential and commercial lending, Australia’s largest Australian credit licence holder and an award-winning technology platform, Podium.
“The changes position PLAN Australia, Choice and FAST to continue to achieve great outcomes for brokers and customers. Loan Market Group brings strong credentials and will enable brokers to continue building their businesses and delivering for customers.
“NAB looks forward to continuing our strong relationship with Loan Market Group as the bank behind the broker.”
The PLAN Australia, Choice and FAST broker network, which provide aggregation services for residential home loan and commercial loan brokers, has around 4,100 brokers.
According to Loan Market, this is not the first time the group has employed the strategy of providing brokers choice between a retail and wholesale offering.
In 2012, the major brokerage purchased New Zealand wholesale mortgage aggregation business Allied Kiwi, through which New Zealand Financial Services Group was formed.
Loan Market works with a panel of 62 lenders and supports a network of over 700 brokers across Australia and New Zealand, with a further 850 brokers trading under their own brand.