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ISCOVER
Jessica Darnbrough
Brokers who choose their aggregator based on the commission splits will end up in tears, one aggregation head has claimed.
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Earlier this week, nMB’s managing director Gerald Foley said there is “so much more to just squeezing a high commission split when looking to build a strong mortgage broker business”.
“In the coming months and years I have no doubt the advantage of aggregator strength, size and stability will become more relevant within the mortgage broker industry,” he said.
nMB, which was acquired by Aussie Home Loans earlier this year, has gone from strength to strength since the acquisition.
This month, the aggregator set a new settlement record for October, settling $196 million for the month, $30 million more than its previous best October.
Mr Foley said the achievement was a huge milestone for the company and one that would “roll into a strong finish for the year”.
“When we look at the settlement and average productivity levels achieved by nMB’s brokers across the group, coupled with our continual high ranking against various lenders’ quality and conversion measures, I believe nMB is 'pound for pound' the best performing aggregator in the market,” he said.
Mr Foley is not the first aggregator to argue that critical mass will form a key component of an aggregator’s success.
Earlier this year, Mortgage Choice chief executive officer Michael Russell told The Adviser that smaller aggregation groups could be swallowed up in the future as the market continues to consolidate.
“One thing we know is that head group margins are tight,” he said, “and, at the end of the day, volumes are very important, especially to the head groups.
“While there are a couple of great boutique players in the market at the moment – and they are great for competition – over time, I won’t be surprised to see some of them disappear as consolidation becomes more rampant.”
Meanwhile, Aussie’s executive director James Symond has long held the belief that industry consolidation is just “par for the course”.
"I have said it in the past and I will say it again, I believe the big will get bigger and the small will become state-based and boutique. You either need to get very large and go national, or stay small and stay specialised,” Mr Symond told The Adviser.
