Helping brokers thrive

Mario: [00:00:18] I think this stat will answer that question fairly quickly. 97% of our business is from mortgage brokers, so you can get a true appreciation of how important it is for Pepper. We've been backing the broker channel now for 21 years and those that know me, I used to be a mortgage broker myself and I do sympathize with mortgage brokers and understand their pain points. And hence the reason why we invest so much time in better adjusting our processes, our products, the way that we communicate our products and everything that they tell us that needs to be adjusted or rectified or change to better suit their atmosphere and environment. We are on the front foot constantly changing, we're constantly improving and making sure that we are delivering a seamless and transparent offering to both the broker and the customer. The other thing that we've done to make sure that we support the brokers is that we never contact a mortgage broker, introduce customer directly unless a broker has actually asked us to contact them. We respect the channel that has that is referred that customer to us and you will not get any channel conflict coming in from the pepper stable. We honor and we respect that relationship that the broker has with their customer, and we never interfere with that unless the brokers engage with us and ask us to. So that's something that brokers have really given us a high five on in this area because they know that their customers are safe with us. The other thing that we've done is we've really upped the ante on supporting their customers post settlement. So making it easier to deal with us, whether it be digital statements, whether it be all the things that they require in a fast turnaround times on on phone calls, everything that they require on that post settlement service actually then makes a really good reflection onto the broker because remember, brokers have recommended pepper or other lenders to that customer, and brokers should be very weary of how those customers are being treated post settlement because it's a reflection on their recommendation. So that's why we take that very seriously. We're constantly engaging in broker groups to see, you know, any areas of focus that we can we can improve on. And we've been doing that now for for 20 years, but have had really significant inroads in the last probably 18 months. And the brokers have realized it and they really actually are loving it. And that's the reason why last year we grew our mortgage originations by just shy of 90% year on year. There is a there's a reason behind brokers choosing pepper before our peers or other lenders in what they have available to them on the panel. And that's a combination of market leading turnaround times, accuracy and transparency in the way that we we offer indicative approvals, the way that we treat their customers. And we've got a very strong medium force that really have built trust with the brokers that they get it right the first time and not just send it in just to see what sticks. Yeah. Look, originally in 2000, when we opened our doors, we started off as a non-conforming lender serving those underserved borrowers that were traditionally let down by the banks. That is still remained part of our core offering. But in 2012 we launched the new prime product to Australia, which really did fill a void between prime or bank product and the non-conforming traditional product that was in the market and that was a huge success. Then in 2014 we launched into Prime, so competing against the banks but with a bit of an edge. And again, that's been one of our fastest growing segments of the market. So brokers have been very receptive to our prime product, our near prime product and our specialist in a non-conforming product. We also in 2014 launched our asset finance product, which is now we are the largest non-bank asset financier in the country. So again, we have been able to deliver on broker needs. We have been listening to the brokers, we've been listening to their customers. And that's has allowed us to to grow to the level that we have and deliver such significant growth year on year through the broker channel. Because of our diversification strategy in 2009, we launched into commercial real estate loans. Again, we're using the same distribution footprint and we're having success doing so. And why that's important, because when brokers have trust in a brand, they trust that we will get it right with whatever product that we offer into the market in the future. And that's what that's what they've been doing. They've been voting with their feet and using our commercial products, using our new prime products, our prime products, our asset finance product. So for me, from a business lens, it was very important for Pepper to diversify away from just non-conforming because we had a great service proposition and we wanted to share that across more asset classes, which then took on more customers and we will be able to help more customers. The other thing is, you know, diversification is very important for mortgage brokers because there are peaks and troughs in every market. So when the market is hot in homes or housing, you know, it might not be as strong in asset finance. Last year was an anomaly where both the asset finance sector and the home sector were on or on peak performance. They were really growing at a rate of knots. And those brokers that had identified diversification as part of their strategy a couple of years back really flourished and benefited from the last couple of years with the growing segments in both asset finance, commercial and real estate home loans. I urge all brokers, and I remember being a mortgage broker 15 years ago, 20 years ago, and back then it was a big drive by the aggregators to say you need to diversify, don't pigeonhole yourself into one income stream because really at the end of the day what they should be focusing on is the customer needs. So if their customer needs branches out from a home loan to a car loan to a boat loan or to a commercial real estate loan, it's the same customer. It's the same customer that trust that trusted them to do the home loan. So it's very easy then to do a car loan or a commercial loan. So they need to be able to focus on, again, understanding their customer base and then understanding where those customers are going to get loans through, whether it be through their banks or other brokers to get a car loan through another broker. I mean, why would you give away that that risk of losing that customer to another broker in that perspective? So for me, diversification is key for mortgage brokers and some of them are specialty and they prefer to be just specialized. And that's fine, that works. But if you if you really do focus on diversification, you will reap the rewards in the outer years. Yeah. Look, for us, it's all about education again. So, you know, it's it's something that we've been passionate about for over 20 years and we have invested a lot of time and money in broker education. We do hold education sessions in-house, so we are more than happy. If you reach out to your BDMs, we can sit down and we can train you on commercial lending. The way that we have actually launched our commercial product is try to make it practically identical to a home loan. The process, the look and feel of the application, the whole lock, stock and barrel is designed around a residential mortgage broker being able to very easily just write a commercial loan. We're not doing anything that is sophisticated. It's  just your typical commercial property. So really the differences between the two experiences is one's a commercial property, one's a residential property. So we've stripped down and got rid of all the complexity in that area. But with regards to diversification, it does come down to education. If you don't know your stuff, then you're going to be left red faced again in front of your customers. So it's important that you reach out to Pepper and we're more than happy. Whether you use Pepper or not, we are more than happy to educate you and run you through credit training, run you through product training, around our asset finance, around our commercial real estate loans, and obviously our home loans, which also has a component that is somewhat specialty, which is non-conforming. So for those customers that have endured some form of life events that you may turn around as just a natural course of the way you do business, it's actually a very lucrative and very appealing component of the industry, and it's growing year on year and will start to start to become a meaningful piece of the house or residential market as we start to get into an area where there is, you know, rising rates and more stress starts to come through the books. I'd just like to take this opportunity to thank all the mortgage brokers, asset finance brokers that have constantly supported pepper money for the last 20 years. We are continuing to ensure that we deliver the best in class service and more products your way. So watch this space. Thank you and have a great day.