How will industry consolidation impact broker businesses?

The consolidation of the Australian mortgage broking industry is well underway. Mergers and acquisitions have been rampant in recent months, a trend that is set to continue in 2021.

In this environment, some brokers have been left wondering where the industry is headed. Most will be wanting to know what their options are.

Mortgage Advice Bureau, the UK’s largest mortgage group, saw the writing on the wall for Australia after experiencing the Mortgage Market Review (MMR) after the GFC. This watershed moment, which can be compared to the Hayne royal commission, led to increased compliance and a significant improvement in advice standards. It also saw broker market share in the UK increase dramatically.

These changes became the catalyst for industry consolidation as individual brokers sought the safety and scale of bigger brokerages. As we anticipated, the same trend is now taking place in the Australian mortgage market.

It is in this environment that Mortgage Advice Bureau can provide the most value as the growth partner for ambitious, professional mortgage brokers who require the right tools to successfully scale their businesses.

Mortgage Advice Bureau offers the foundations of an aggregator, along with custom technology, efficiency processes and a proven lead generation strategy focused on the customer.

Our entire proposition is built around the customer, not the lender. Since launching in 2000 we have continued to embrace change and harnessed the best in telephone-based broking, technology and digital channels to be driven by what the customer wants.

Our multi-channel approach to mortgage broking is aligned to the way customers want to research their home ownership options, engage with a broker and transact.

Few brokers have the infrastructure to allow customers to use whichever channel they prefer, at any stage in the process. That’s what MAB has brought to the Australian market: a mortgage broking model that puts the customer first.

Recruiting an army of loan writers is not our goal. In fact, we only work with selected brokers who are elite operators and have what it takes to become business leaders.

In the UK we have tripled our broker numbers since MMR to include a network of 1,500 brokers across 160 firms. The average MAB broker firm has nine staff and a salaried model that offers employment options for ambitious graduates. Productivity among our firms is approximately five times the industry average, increasing profitability and the valuation of our firms.

For smart brokers looking for a specialist to help them scale their business profitably, MAB provides a compelling alternative solution in a consolidating industry.