Australian Broker magazine Issue 9.13

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The no. 1 news magazine for Australian brokers.

Text of Australian Broker magazine Issue 9.13

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    Banks outside the four major lenders are holding their own in an intensifying war for bank customers based on service and satisfaction.

    ING Direct executive director of delivery Lisa Claes has said non-major lenders were beginning to claw back the ground they lost during the global financial crisis.

    I think in the last 12 months we have seen a slight kick-up in our share of new business but the

    happy; they are fighting just as hard and they are big engines.

    Claes said in such an environment, the focus on service and satisfaction by all lenders will continue, and some non-major lenders had a distinct advantage. For example, ING Direct can demonstrate among the highest bank customer net promoter scores and satisfaction ratings.

    ING Direct has declared it will grow its mortgage book responsibly.

    We are a branchless bank so we are not beleaguered by channel conflict, we dont have to worry about product and price differentiation, and we dont have the legacy of the bricks and mortar system. Our focus can be squarely on brokers who are our branches.

    ISSUE 9.13

    July 2012

    Back on timeSt.George reverses turnaround blowout

    Page 2

    EZY with PLANNew panel lender to add diversity

    Page 4

    Aged overhaulBroker calls for older borrowing fairness

    Page 8

    Inside this issueViewpoint 19Positives amid market negativeOpinion 20The segmentation choice is yoursInsight 22Prospecting for successForum 23Brokers on conversion criticsMarket talk 26The census and your businessPeople 28CEOs and the homelessInsider 30Comparison rates, apples and oranges

    Major banks have been put on notice to watch for invigorated competition rising from the second tier

    Non-majors declare themselves fit to play

    sector certainly hasnt regained the ground or the place it had pre the GFC, she said.

    However, Claes said the drastic increase in concentration among major lenders had stopped increasing, and the market was now seeing other banks and non-banks increase share.

    The result is an intense war for the customer, amid conditions that include a slowing credit market, a growing reliance on deposit funding and pressure on net interest margins.

    The category outside the majors is a healthy one but you need to be fit to play, because it is a highly competitive one. Of course, the majors arent sitting back saying we have got the scale so we are

    Lisa Claes

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    Australian Broker is the most-often read industry publication, according to independent research carried out by the Ehrenberg-Bass Institute for

    Marketing Science at the University of South Australia in December 2008.

    The research also found that brokers rate Australian Broker as the best for both news content and feature articles, followed by sister publication MPA.

    Overall, on all categories, Australian Broker ranks top followed by MPA. The results were based on a sample of 405 respondents who were the

    subject of telephone interviews.

    St.George speeds up turnaround timesSt.George Bank has managed to drastically reduce its turnaround times after special pricing offers caused its response times to increase earlier this year.

    St.George told brokers attending its Sydney road show in June that its turnaround times were back in the black after competitive fixed and SVR rate offers caused a surge in applications earlier this year.

    Applications being submitted to St.George by brokers increased by 1000 per month during the period, while calls to its Mortgage Central call centre experienced waiting times up to 13 minutes.

    The surge caused conditional approvals to increase from a targeted one to two day turnaround time, to up to four days.

    General manager of mortgage broking, Clive Kirkpatrick, said

    although the upsurge had caught the bank flat-footed initially, the hiring of 80 back-office staff had mitigated the turnaround problem.

    Mortgage Central call waiting times are also back down within a targeted one minute waiting time.

    Kirkpatrick said St.George was now well positioned to cope with any future upsurge in demand, promising that it would continue to roll out innovative products and pricing offers.

    The bank announced that it had appointed a new NSW state manager to oversee its NSW BDMs, and brokers nationwide could now all access BDMs regardless of their segment.

    St.George now has 25 BDMs nationwide, and nine in NSW.

    Kirkpatrick said the bank was

    continuing to innovate with technological improvements such as its newly released broker iPad app, which includes a serviceability and LMI calculators.

    As a result of the spike early in the year, St.George has also implemented a minimum requirements checklist, which ensures brokers have the basic documentation in place after an application is made and before it is passed on to loan assessor.

    St.George said 35% of deals are still missing key information, and this was partly because the bank had increased its accredited broker numbers who were still becoming familiar with its policies.

    Homeloans has labelled its acquisition of Refund as a major win for its branded distribution.

    The company has completed its purchase of the embattled Refund Home Loans business, more than eight months after the business entered administration. The deal sees Homeloans expand its branded distribution by adding 54 former Refund brokers to its current stable of around 20 branded brokers.

    Homeloans general manager of funding and investments, Scott McWilliam, said the deal would massively expand the companys branded distribution.

    We issued 135 broker agreements, and 54 of those came across. Were very pleased with those that have. The 54 that came across represent a large proportion of the settlements and book of the Refund business, he said.

    McWilliam said the acquisition represented a positive step for

    Refund brokers who had struggled through a protracted period in administration.

    Its a good win for those guys. Theyve been through a pretty rough time over the last nine months. If we can help them grow their volumes and grow their business, that works for them and it works for us, he said.

    McWilliam said the Refund brokers who had aligned with Homeloans as part of the deal were already operating as Homeloans brokers, and receiving marketing and BDM support.

    Weve been in communication with them throughout the whole process leading up to completion. Theyre out there carrying our brand, and we will continue to provide them with marketing support to help grow their

    business in the local community, he said.

    The acquisition is part of a strategy implemented by Homeloans to grow its broker distribution network, McWilliam said.

    This transaction fits perfectly with Homeloans strategy to expand through organic growth and acquisitions. From our perspective it was a mutually beneficial match and fit. They needed a home and brand to broker underneath, and were out there looking for ways to grow our distribution either organically or via acquisitions.

    Non-bank heralds massive expansion

    Clive Kirkpatrick

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    PLAN expands panel through Mortgage EzyA leading aggregator has expanded its panel with the addition of a non-bank lender.

    PLAN Australia has announced it will add Mortgage Ezy to its panel. Chief executive Trevor Scott said a diverse lending panel was becoming increasingly important to brokers.

    Today brokers face a challenging and highly competitive mortgage market where access to a diverse and extensive product range and

    diversity is crucial to success. We understand these challenges and strive to provide our members with a full range of products to ensure they can meet the needs of every borrower, he said.

    Scott said the addition of the lender to PLANs panel would help its members boost their proposition to clients. He praised Mortgage Ezy for its aggressive pricing and product range, and its commitment to third party distribution. Scott underscored

    the fact that the lender distributed exclusively through brokers, a fact he sa