When Ross MacPherson is trying to impart some wisdom to his commercial origination team, he's more than likely to use the example of a famous moment from the past, such JFK's handling of the Cuban missile crisis as an example of how to handle pressure situations.

A somewhat unconventional approach, but not altogether surprising when you discover that the thing he enjoys most about his role as head of commercial origination at ANZ Business Banking is that it's "not your traditional banking role".

"I feel more like an aggregator partner, than a traditional banker," is how he explains it.

For the last three years, as head of commercial origination, much of MacPherson's time has been spent networking with brokers and aggregators, passing on the message about the bank's products, and ultimately building relationships that direct commercial business towards the bank.

ANZ was one of the first banks to look to brokers as a source of commercial lending and MacPherson says he's been fortunate to work for a bank that is happy to move with the changes in the market, and - based on his recommendations - change its business model to suit this market.

Broker contacts

Looking back over his career to date, the third party channel has played an important role in what has been a long career, mainly in mainstream banking.

Prior to moving to Melbourne to commence his current role three years ago, MacPherson spent all of his working life in his home town of Brisbane. His connection with brokers stretches all the way back to his first lending role at Esanda finance, where he dealt with brokers in the car finance space.

This was followed by 13 years at Suncorp Metway, where he cut his teeth in commercial lending, undertaking a host of roles including those in equipment finance, property development finance, corporate banking and business banking.

With his strong ties to the broker market, MacPherson says he met targets consistently: "I met budget because of my stronger broker network- something unique at the time."

His successful dealings with the broker channel, lead to a defining role at Suncorp, where he headed up its third party commercial banking division. Here brokers would, once again, drive the success of the business. He recalls that most managers at the time did not deal with brokers, preferring to deal with direct networks. Even more challenging, commercial broking had not yet taken off and the idea of a residential mortgage brokers branching out into commercial lending, was an almost unheard of concept.

Despite these obstacles, MacPherson succeeded once again, and ANZ was soon knocking on his door.

He duly signed on as Queensland state origination manager for ANZ Business Banking, spending two and a half years building up a commercial origination business when none had previously existed.

"There was no commercial origination within ANZ in Queensland [before I came on board]. I started the business from scratch, developed contacts, brought them across, created the channel, managed the channel and created the volume."

Building volumes meant tapping into the residential broking market and asking brokers, "why not think about commercial lending?"

He was helped by the fact that at the same time as he was setting up the framework and structure for the business, a lot of commercial bankers were stepping out of banks to become brokers.

"They were looking for a major lender with good third party model, because there were not many that did it at the time.

"ANZ was one of the first to market with its third party platform. Being first to market has given us an advantage."

And he's certainly made use of this advantage, delivering not just for ANZ and brokers, but most importantly for the clients of brokers, something he "gets a real buzz out of".

"If you go back seven years ago, the commercial third party market was only just emerging and was a very small part of a broking market dominated by residential - now it's quite prevalent in the market place.

The move from Suncorp to ANZ, he says was something of a leap of faith. He went from a yearly lending target of $12m to $80m - a completely new business.

"I was fortunate that I entered an emerging market at the time, it was a big leap of faith, especially since I left a role at Suncorp where I was quite comfortable and doing well. I was meeting budget and enjoying my career.

"Sometimes you just have to back yourself. People had faith in me, plus I had the network of brokers behind me."

In his current role, he oversees all commercial origination state operations and key aggregator relationships, making use of the good networking and contacts base he has built up over the years.

Despite now calling Melbourne his home, MacPherson remains a Brisbane boy and the Queensland laid back style has filtered through into how he manages his team.

"I enjoy dealing with people in my team. I am quite lucky because I have inherited good people."

MacPherson says he is quite consultative and gives the team "a fair bit of rope to work their patch" though he says they know they have to get results.

Networking

When asked what he enjoys most about his job, it is perhaps not surprising that networking rates highly alongside the ability to change and tweak the model.

He's always enjoyed the interaction with aggregators and brokers: "In my role now I really just deal with aggregators...but I enjoy getting out and talking to brokers about the market."

That, and the fast changing nature of the market is something he's always found exciting, 
 
Like everyone, MacPherson is well aware of the current challenges facing the industry - in fact looking back over his seven years in commercial lending, he says nothing compares to what is happening now: "We are facing a really interesting time," he says, before running off a list that includes a slowing economy, slowing business investment, costs of funds increasing for all major lenders, and the recent review of commissions.

"All of these things happening now...plus legislation coming in, are the biggest changes that I have ever seen, and they're all happening at once."

Despite this convergence of factors he remains confident about the business.

"It's a significant proposition and the business is here to stay. From ANZ's point of view, we will continue to invest in this business and we're looking to grow broker originations.

"We have a pretty good model, but there are areas to enhance or improve, and there also specialist products to add that the bank is looking to deliver through brokers."

Doing things differently

MacPherson is adamant that ANZ does things a little differently to its competitors.

"Our latest feature rolled out, is our 'platinum' broker model which is an enhanced and improved service proposition for our top brokers in each state," he says. And with service to brokers so important, it's the kind of thing MacPherson is looking to do more over time.

On the subject of service, MacPherson highlights another point of differentiation - the way it structures its broker-centric platinum model. "Rather than have a central team, our relationship team is geographically located close to brokers and rather than the traditional relationship manager and assistant RM, we have a team of four, linked in more closely to our credit team to provide better service and turnaround times."

Clearly making life easier and more productive for brokers is high on the agenda with MacPherson noting that the biggest challenges he faces is keeping pace with the industry and constantly meeting the needs of brokers and their clients.

"We must keep in touch with the market. We have invested heavily in them and we want to support them with training and tools."

Conservative approach

On the lending side, MacPherson expects a return to more traditional lending, combined with sharper execution around that lending.

Not surprisingly, ANZ errs on the conservative side when it comes to approving deals, as MacPherson explains by way of an example: "Historically, if you were doing a traditional commercial lend (say a transport operator building a factory), you would look at LVRs, interest coverage, balance sheet and profit and loss ratios. Now - given the nature of that lend every bank will be looking more closely at things like rising petrol costs."

What this means for a broker is not only do they have to make sure they have the commercial lending skills, but they also have to have the ability to dig deeper and be able to negotiate with their clients.

"This was much easier to do 12 months ago, but now a broker needs the skills to have those conversations with their clients," he adds.

But while settling commercial deals is harder and requires more work, MacPherson is adamant that brokers will continue to be part of the commercial sphere.

"The fundamentals haven't changed. Consumer sentiment is that the majority prefer to go through brokers. It might come off a little bit, but not a lot and commercial brokers will still need to service that demand.

"Brokers with good networks and skill sets will still be in demand."

Hitting the history books

While it's a demanding role, MacPherson says he does manage a relatively good balance between work and family life (he has two young kids aged 6 and 3).

"I travel a lot, but try and keep it to one or two nights max."

While his children take up most of his weekend time, his interest in history has developed into a full scale writing project.

"I am writing a book about my grandfather's history during World War 1. He went to the Somme and survived."

Over the past few years he's been researching his grandfather's life, visiting libraries, speaking to relatives overseas, combing over books and photos he's found and what started out as just a project to retrace these experiences has blown out into an 80 page document.

"The book is 95% completed. When it's finished I want to get across to France and retrace my grandfather's steps."

Clearly, writing the book has given him a similar buzz to working with brokers.

"I won't forget the first day I got to my new desk at ANZ and called some of my key brokers and told them where I was. The response was "thank god you're there"

"As soon as I heard that I knew I would be OK."

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