AFG is evolving its service offering, maintaining its position as the market leading partner of choice for brokers.
Australian Finance Group Limited (AFG) has today announced that it will become the first Australian mortgage aggregator to acquire non-controlling equity stakes across its network of mortgage broking businesses.
AFG Chief Executive Officer David Bailey said the Perth-headquartered ASX-listed company’s strong balance sheet meant it had access to funding which could be used to take equity positions in well-run, growth-minded broker businesses across Australia.
Mr Bailey said AFG had been testing the market and found a strong appetite for investment, with active discussions underway. “AFG’s founders pioneered the mortgage broking industry 30 years ago. Since then, the industry has gone from strength to strength, with customers recognising the many benefits of using a broker, and brokers now responsible for around 74 per cent of all mortgages written,” he said.
“It’s only natural given how established the industry now is, that demographics are changing, and through AFG investing in its brokers’ businesses we are helping to facilitate succession planning for some and expansion for others.”
AFG has appointed Vik Sukumaran to lead a newly created Broker Investments team responsible for delivering and managing these investments. Mr Sukumaran brings over two decades of transaction and corporate advisory experience, including as General Manager of Operations and Acquisitions at ASX100-listed insurance intermediary Steadfast Group Limited, and senior manager at BDO.
Mr Bailey explained the company’s investment offering: “We believe in backing our brokers. AFG has heard from its brokers that they are seeking assistance to expand their operations and support their growth.
“Every day AFG staff work with our broker network to help them build their businesses. As small business operators, access to funding for business expansion or forward planning for an eventual retirement, can prove challenging.
“We have listened to these requests, and it has led us to offer a solution whereby AFG would invest in the business, taking a non-controlling equity position, providing that surety of funding, along with additional expertise to support the growth of their businesses.”
Mr Bailey said there was no obligation for brokers to participate and AFG’s value proposition would remain the same for all brokers, irrespective of whether AFG was a shareholder.
“Our unwavering commitment to brokers and high-quality offering of products and services will remain consistent for all member brokers.”
Mr Bailey said the new initiative reinforced AFG’s ongoing commitment to the company’s model of shared success.
