Major player posts record growth without ‘red stars or doughnuts’

The head of one of Australia’s largest mortgage aggregators says the group has experienced “record numbers” of new recruits keen to join a brokerage not owned by a major bank.

Speaking to Mortgage Business, AFG managing director Brett McKeon said the ASX-listed mortgage business has just experienced its “best ever recruiting year”, lifting broker numbers from just over 2,400 in 2015 to finish the financial year with over 2,650 active brokers.

“The last year was our best ever recruiting year and the previous year was really strong too. From where we sit we couldn’t be happier with that result. We had a record number of new brokers. That will show through in the next year’s results as well,” Mr McKeon said.

“We don’t have big bank shareholdings on our register. A lot of brokers like the fact that we don’t have ‘can do’ or red stars or doughnuts all over our register in any material way. I think that would be another reason why we are growing as well.”

AFG posted a net profit after tax (NPAT) of $22.6 million for the 2016 financial year, about 15.1 per cent ahead of its prospectus forecast of $19.7 million and 48 per cent up on the $15.3 million from continuing operations in FY15.

The group now boasts a combined residential and commercial loan book of $120.4 billion, up 12.6 per cent over 12 months.

The mainstream media lens, which was once narrowly focused on the financial planning space, has turned to the mortgage industry over the last 12 months as announcements form APRA and ASIC take centre stage.

Mr McKeon has made a number of strong responses to questionable media coverage of the market over the last year. He has also urged borrowers to stand up and be heard amid ASIC’s remuneration review.

The AFG boss said that mortgage settlements through the third-party channel have remained strong despite negative press and challenging market conditions.

“It is pretty obvious at the end of the day why we are growing. I’m quite hopeful that over the next few quarters we will approach 54 to 55 per cent broker market share.”

“The distribution network our brokers represent is a key driver of future growth and opportunity for AFG and clearly one of choice for Australian consumers,” Mr McKeon said.

[Related: 'Macquarie doesn't have a say': AFG]

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