The Mortgage Professionals (TMP), National Brokers Group (NBG) and The Brokerage (TB), have signed an agreement in principle to merge to form a new aggregator, to launch early next year.
The announcement ended months of speculation dating back to March this year when the story was first broken by Broker news.
The new merged entity will bring together a national network of more than 900 brokers that collectively have loans under management of about $16bn (as at November 2009).
"The deal is expected to be finalised early next year provided all relevant conditions precedent and approvals are met. The new business will then be officially launched with its new name and brand," the three aggregators said in a statement.
Currently, it has the project name of "Wonderland".
Besides the three aggregators, the two other signatories to the agreement are Macquarie Bank, which helped to facilitate the merger, and Jeff Zulman, the proposed CEO.
"This is an exciting development for this industry. The new business offers all the advantages of size while losing none of the traditional broker-focused values of these three aggregators. Certainly the business model we have devised is creating interest in the market place," Zulman said.
NBG chairman Rod Lange said the merger could not come at a better time for brokers, while TMP CEO Michael Nicholson said merging the three businesses, would achieve "economies of scale that will underpin our brokers in every aspect of their business".
TB chairman Geoff Smith said: "There's no doubt brokers are doing it tough right now, and this new merged entity aims to give control and power back to them."
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Steve on
30 Nov 2009 01:15 PM
As a current NBG Broker I am quite thankful that my contract is open and I can leave at any time. Any Mortgage business involving Macquarie is bound to disregard the people and pay attention ONLY to profits. Been there, done that......
Broker Watcher on
30 Nov 2009 03:19 PM
"Certainly the business model we have devised is creating interest in the market place," Zulman said.
Yep competitors are lining up to recruit, recruit, recruit
Aggregator on
30 Nov 2009 03:20 PM
TB chairman Geoff Smith said: "There''s no doubt brokers are doing it tough right now, and this new merged entity aims to give control and power back to them."
Any broker doing it tough right now is with the wrong aggegator. Business has been fantastic in 2009.
Steve on
01 Dec 2009 08:44 AM
Lets forget the emotional hype for a moment and have a strategic look about where the industry is heading...
AFG, owned 10% by Macquarie and 10% by Life Insurance companies.
PLAN, Choice and FAST - 100% owned by NAB. (Wait until the new year when the new pricing structures come out, then some people will need to rethink their position).
Aussie - 33% owned by CBA. Then there''s CBA who are currently sitting on their most recent purchase - which is an aggregation group.
Mortgage Choice - owned by a range of share holders. Have a look at their share register to see who the major investors are.
So the industry is changing from private investors to institutional investors, such as Banks, Life companies and general share holders. This is a very similar situation to the chnages that happened in financial planning - where the dealer groups (aggregators) became backed by professionals investors. Which in many cases meant yes Banks and Life companies. Professionally investor backed aggregation groups isnt big news.
Broker on
01 Dec 2009 09:14 AM
Certainly the business model we have devised is creating interest in the market place," Zulman said.
HOW CAN IT, YOU HAVEN''T LAUNCHED IT YET?
Tom on
01 Dec 2009 09:25 AM
NBG is my aggregator and I know that a lot of things Mac Bank touches turns to gold. lets hope that this does too - its very exciting for the industry and these businesses. I look forward to the new year, working with this group.
Neil on
01 Dec 2009 09:46 AM
Good on the groups for taking the opportunity to get together and scale up their business into a viable long term organisation.
I see the Macquarie backing as a good thing as is the CBA, Tower Life and NAB investment in the industry.
Steve on
01 Dec 2009 09:51 AM
Hey Tom, just be careful, Mac are like a big pussy cat playing with a mouse. It starts out as fun for both, and then the pussycat eats the mouse. Just a friendly warning ;-)
Frank ( Ballast Finance ) on
01 Dec 2009 12:24 PM
If we continue to look at our industry strategically - Consolidation and rationalisation is fine .... but , Independent Aggregators are still required !
Broker Watcher on
02 Dec 2009 11:42 AM
Questions for Wonderland
1. Who is Jeff Zulman? Does has have experience in the mortgage industry / running an aggregation business?
2. What will happen to all the existing executive staff at NBG, TMB, The Brokerage? It is noted they will stay on as Directors but will they have day to day management roles?
3. Is there going to be one commission model offered to all members once the members of the three groups are consolidated under one entity?
4. Is it true that the commission model being favcured is a flat fee 100/100 model like Connective?
5. Given Macqaurie is an investment bank will it apply its standard return on investment requirements? If the new business is not meeting KPI''s from day one how long will it be given to perform?
6. Is this consolidation to provide all parties with an exit strategy and if so how long do the shareholders have to hold their shares before they can sell them?