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Suncorp Bank has spent the past two years investing in innovative ways to strengthen the lender’s broker proposition, under the guidance of general manager Steven Heavey, and with the goal of becoming the number one non-major lender
During and in the immediate aftermath of the global financial crisis (GFC), brokers placed their business with the majors – perceived to be a port in stormy waters – while many second-tier lenders exited the market.
With their trust shaken, many brokers have since not gone back to the non-majors and mutuals, leaving a vast majority of the mortgage market to the big four.
After working as executive general manager of mortgages at St George, Steven Heavey moved to Suncorp to reignite the lender’s broker channel and to challenge the big banks’ domination.
“Before I started at Suncorp, I was looking at the brand through competitors’ eyes, and I watched the way they went about securing business from brokers,” he says.
“What I found was that there wasn’t a lot of consistency there. They’d pull the price lever and put a lot of pressure on their back office to try and grow market share.”
According to Mr Heavey, brokers had been writing off the lender before giving Suncorp a chance – and it was his job to break the cycle.
“We have to be different, and we have to be better as a second-tier lender – and that’s why we had to make changes,” he says.
Becoming a viable option
Suncorp Bank had set itself in a niche following the GFC, one in which it could not compete with the majors on price.
“I suppose the reputation we had developed in the past was that we weren’t a viable option unless it was a high LVR, very cheap offer and I wanted to set about changing that,” he says.
To change brokers’ perceptions, Mr Heavey began by conducting a series of roadshows and focus groups with top brokers to develop an understanding of what the market wanted.
“At the same time, we wanted to change the mix of business from being just a high LVR lender to someone who can offer a solution across all LVR bands,” he says.
Mr Heavey discovered that while their product suite was important, other factors were pushing Suncorp down and beneath other lenders.
The bank’s back-office operations, for one, needed a shake up to create more efficient processes.
“Brokers have got to manage the customers’ expectations, and in that process it’s important for brokers to get quick responses,” Mr Heavey says.
“A lot of brokers complained to me that they spend hours on the phone waiting for status updates so we’ve developed an online tracking tool which we feel is nearing ‘best in the market’ [status].”
Suncorp also introduced a workflow tool that allowed the office to go totally paperless.
“Two and a half years ago we were carrying manual files around from floor to floor,” Mr Heavey admits, claiming that the lender’s IT improvements were some of Suncorp’s most important changes.
“We also increased the number of staff we have to answer the phones – we’ve reached a stage where our broker support area is able to get onto the broker in less than two minutes,” Mr Heavey says, something he claims other banks cannot match.
“After all that, we’ve been able to consistently deliver fast, 48-hour turnaround times so much so that we’re willing to put our money where our mouth is and say that if we don’t deliver service within 48 hours, we’ll pay your customer $500.
“So we’re backing ourselves on that promise.”
The new Suncorp
According to Mr Heavey, banks need to respect the broker’s need for efficiency.
“If the broker is spending all their time on the phone waiting to get an answer, they’re not out there writing new loans and growing their business,” he points out.
And it’s this philosophy that has driven Mr Heavey and his team to implement these changes, to the point where he doesn’t even think it’s the same Suncorp anymore.
“When a lot of the lenders pulled out of the market during the GFC, just leaving the majors, a lot of brokers became disenfranchised with second-tier lenders,” he says.
“What we’re trying to do now is send a very clear message to brokers that there are viable alternatives that are meeting the majors head on with price, policy, process and product innovation.
“We wanted to make it very clear that they’re dealing with the New Suncorp, which is not a reflection of when we used to pull the price lever to attract business.”
Mr Heavey says that while, in 2013, brokers talk about wanting to diversify and offering their customers ‘real choice’, during the GFC there wasn’t a choice. Now, there is.
“We’ve had to meet the market in policy, so we’ve had to make some changes to try and attract that different type of business in the sub-80 LVR [bracket]. We won’t decline a deal until we actually ring the broker and speak to them.
“We’ve just made all these little tweaks which we believe make a broker’s life a lot easier – so they can get on with their business.”
