David Smith wants to invest in people, tech to deliver for brokers
Former Aussie CEO of lending David Smith has joined Liberty in the new role of chief distribution officer.
Smith (pictured above) takes the lead sales role as former group sales manager John Mohnacheff transitions into an advisory position after 24 years at the non-bank lender.
Smith understands he has a big task on his hands as he joins an industry innovator and is thrilled to bring his own strengths and skills to the new and important role.
MPA spoke to Smith about his new role at Liberty, what attracted him to the company, market trends, and how he plans to drive growth through the broker network.
Smith worked at Aussie Home Loans for 15 years in several senior roles, most recently as CEO of lending during the 2022 merger of Aussie and Lendi to form Lendi Group.
He said it was a great experience working for a business that had changed and grown significantly.
Smith had a range of responsibilities at Aussie including leading teams looking after strategy, marketing, products and customer service.
“I was fortunate enough to work with a great bunch of people and a brand who put customers first and that was a privilege,” said Smith.
“In terms of Liberty, there are some similarities between the two businesses.
“While one’s on the broker side, and one is on the lender side, they’ve both got the hallmarks of consumer champion brands who try and bend and flex to find out-of-the-box solutions whenever they can.”
What attracted David Smith to Liberty
Liberty is a strong competitor in the marketplace, Smith said.
“It's well established, it has an unmatched balance sheet and I particularly like the fact that it's diversified its product range, its channels and its brands in the market a lot over the last few years,” he said.
“Liberty is a business that wants to go places and I want to be part of that.”
Smith said his time at Aussie had instilled in him a strong customer mindset.
“In a business like Liberty or Aussie, without trusted and strong relationships with your broker partners, you just can't do it, you can’t put the customer first,” he said.
“Brokers have key customer relationships at the end of the day. You need to have that strong level of partnership with brokers in order to be able to serve customers better.”
The new role at Liberty
Chief distribution officer is a new role at Liberty. Smith, who is based in Sydney, praised Liberty’s culture and said the team had been very welcoming.
“It’s a diverse and inclusive culture as well, which is reassuring and positive,” he said.
Smith said his brief was to bring a “fresh perspective” to the distribution strategy across all of the Liberty products, channels and brands, especially through the broker channel.
“We’ve got to work as a group, so that each part of that group is talking the same language, taking a best-foot-forward approach, both through brokers and customers,” said Smith.
However, in the short term, Smith said he wanted to build on Liberty’s strengths.
“This is a pretty robust business with great channels – we want to build on that as we map out the strategy going forward.”
When asked about how he would extend Mohnacheff’s legacy, Smith said: “I'm not sure anybody could match John's illustrious track record in the industry, but I am glad to build on it. My focus is to make sure that we as a group and a distribution team are focused on that growth mindset.
“We need to keep evolving and innovating so that we can keep up and stay ahead in a market where there's so much tech innovation and so much constant and dynamic market change. We've got to run to be able to keep up and keep at the front.”
Liberty’s partnership with brokers
Given the vast majority of Liberty’s lending business comes via brokers, Smith said he was keen to enhance broker partnerships and drive growth through this channel.
He said Liberty had strong relationships with brokers because “they took it seriously and invest in it”.
“You’ve got to have good people doing a great job out there to serve broker partners. They've got high expectations, their customers have high expectations – without them you can’t get to market.
“Liberty sees broker business partners as critical to the model. We invest as a group in tech platforms with the single-minded goal of making it easier for brokers to do business with us.”
Liberty’s integration capabilities create the ability to streamline processes between itself and aggregators.
Smith said this would make processes for assessing applications quicker and easier, with more solutions and choice, which in turn leads to greater loan approvals.
“The other thing that we are and will continue to do, is invest in people,” he said.
The aim is to recruit and upskill the right sales and support teams to “deliver, surprise and delight brokers, be responsive and flexible, find more ways to yes”.
“That's how you win, how you stand out.”
Coping with higher interest rates, inflation
There’s no doubt borrowers have been dealing with the challenges of rising interest rates and inflation, with some homeowners in mortgage stress and some SMEs struggling to stay afloat.
Smith said Liberty assisted customers in a number of ways.
“If there’s a particular customer who's experiencing difficult circumstances, then we'll work with that customer directly or with their broker to provide whatever assistance we can.”
Small business owners and the self-employed also face cost pressures, as do homeowners.
“We've seen a bit of mortgage stress, on the commercial side as well, but not particularly acute and we'll continue to manage any individual cases as best we can,” Smith said.
Smith highlighted the fact that a lot of customers are in strong financial shape, whether they are residential borrowers or strong small businesses looking for commercial lending.
However, they didn’t fit the serviceability constraints of the mainstream major banks and lenders.
“This is where non-bank lenders such as Liberty can help,” Smith said.
“Our purpose is to provide flexible specialist solutions and look for free-thinking ways to support customers.”
For Liberty, Smith said there was strong demand for SMSF lending, SME commercial finance and debt consolidation.
“Positively, we're seeing small businesses turn their mind back to growth, having hunkered down through that period of rate rises, they’re now seeing some stability ahead.
“We’re seeing a strong increase in demand for low doc lending to those self- employed and small business customers.”
Smith said non-traditional lending solutions provided a point of difference for Liberty in the market.
Lending competition
But Smith also acknowledged that if Liberty was seeing opportunities in the market, so were other lenders.
“Clearly, it takes a lot to compete across multiple categories of products in the same space where players like the major banks are dominant,” he said.
“Liberty has been thriving in this kind of environment for over 25 years and has what it takes to compete effectively.”
However, major banks didn’t want to compete as hard when it came to specialist lending, providing a niche for Liberty.
AI and new technology
Smith said the tech landscape also presented challenges and opportunities.
“We’re in an unprecedented period of tech disruption, not so much about what's happening, but more about the pace that it's happening,” he said.
“If you did a word search for AI, it's probably in the millions per day and yet if you really pressed people, does everybody really understand what it is, what it does, what the challenges and opportunities of it are?”
Smith said the mortgage industry, like many, was accelerating towards leveraging AI and other technology advances, which would be disruptive.
“We’re looking to invest and increase investment in tech and AI, like many other players are, but that's definitely an opportunity as well.”
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