To The Pointwith Boris Bozic
Commentary, Opinions, Thoughts and Discussion on Current Events, Politics and The Mortgage Industry

4 Comments Farewell to ING

Article written by on the 17 Jan 2013 in Lenders,Mortgage

I feel like that old man slowly watching his friends die off; checking every day to see if his name has made into the obituary section, realizing it hasn’t he goes about his day.

In the short time that I’ve been blogging I’ve written a few farewell blogs to lenders who are no longer with us.  Ashes to ashes, dust to dust, we bid so long to ING in the broker channel.

Firstly, if the news that the ING brand will no longer be available in the broker channel, well, I’m surprised – anyone would be surprised.  Scotia Bank, who purchased ING Canada, is focused on franchising customers and their strategy is to enhance and grow their own brand.  So it was only a matter of time before orange would become totally red.  I guess the time is now.  The loss of any lender in our space is troublesome, on many levels. Competition has many benefits, pricing, product innovation, and credibility.  To think this announcement won’t create a dominos effect is a little naive.  Recently some lenders have announced a reduction in finder’s fee.  Why? Because they can.  That’s what happens when choices become limited.  Don’t believe me? Ask any broker in Australia.  I’m not suggesting there will be a mad rush by lenders to reduce compensation but with every announcement telling us another lender has exited the market the possibility increases.  It’s Darwin’s theory of business evolution.

For those who have supported ING you should take a moment to thank them for their support of your business.  They paid well, they had aggressive pricing, and from what I heard they made tremendous strides from a service standpoint.  If you were a supporter of ING you can’t complain, it was a good run.

Until next time



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5 Comments Farewell To An Iconic Brand – Firstline, CIBC

Article written by on the 21 Jun 2012 in Lenders,Mortgage

 Firstline exists mortgage business“Firstline played a major role in the development and growth of the mortgage broker channel.”

I suspect by now you’ve heard the news that  CIBC has decided to wind down it’s broker brand, FirstLine Mortgages. The industry has been rife with rumors about FirstLine’s future for some time now.  CIBC finally had to confirm that FirstLine was in play, for sale.   There was chatter that a sale was imminent and that the FirstLine brand  may survive but in the end it ended up being “the end” for FirstLine.

CIBC made a business decision to wind down FirstLine, and not being privy to the facts it would be inappropriate on my part to say if they were right or wrong to do this.  I will say this, it’s a shame.  Firstline played a major role in the development and growth of the mortgage broker channel.  Many moons ago I worked for CIBC/FirstLine, as the Area Franchise Manager, Western Canada, for Mortgage Centre Canada. I thought about about some of the people I worked with back then, and the others who at one time worked for FirstLine.  Many of our industry leaders today were at one time employed by Firstline. To me this is a mark of an organization that prided themselves on hiring the best people, for many of these people went on to lead other organizations.  FirstLine always had a reputation for being the best.  They set the standard for all others to follow.  As a competitor, on more than one occasion, I would curse their name.  I did so out of begrudging respect.  I always wanted to beat them but not this way.

In time FirstLine will fade from our memory.  But before that happens I think we should reflect on the importance of FirstLine, and the contribution this brand made to our industry.  No one should take delight in this announcement.  As a former customer and a present day competitor, I want to thank FirstLine for their historical relevance and for the contribution they made towards legitimizing our industry.

Until next time,





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3 Comments Australia’s Mortage Industry: Worlds Apart

Article written by on the 17 May 2012 in Business,CAAMP,Lenders,Mortgage,Travel

By the time this blog is posted, I’ll be somewhere over the Pacific Ocean heading towards Sydney, Australia.   My final destination is Adelaide, Australia.  The purpose of the journey is to attend the Mortgage & Finance Association of Australia National Conference.  It’s a long, a very long way, to go to attend a conference.  By the time you read this blog, I will be well into my 22 hour flight and, I suspect, I will be going a little stir crazy.  I’ve traveled a number of times to Europe, but an 8 hour flight to Europe is like a walk around the block compared to “going down under.”  It’s a trip I always wanted to make, but I always found a reason to put it off.  Must be the thought of been cramped in a tin can for 22 hours.  But now, there was definitive time and reason to go.  The MFAA is Australia’s equivalent of CAAMP.  As much as I’m delighted to remove an item from my bucket list, going to Australia, the primary purpose of the visit is to represent CAAMP, and to go for my own personal development.

Canada and Australia are similar in many ways; specifically as it relates to the mortgage industry, an oligopoly exists in both countries, but the big difference is the disappearance of mono-lines in Australia.  That was a result of the credit crisis of 2008, or as the Aussie’s like to say, the GSS (Global Shit Storm).  The mortgage industry in Australia changed significantly post-2008.  As mentioned, mono-lines became a footnote in the annals of the mortgage lending history in Australia.  Given limited competition, broker commissions where significantly reduced.  The four major banks in Australia now control 90% of the broker market share.  The banks imposed proficiency exams on brokers to do business with them, at a cost of $750 to write the exam.  The major banks took an equity position in some of the larger broker house’s in Australia, and they exercise their influence and control by way of board seats.  Yet, for all the challenges the Australian broker market has faced since the GSS, they still control a 40% market share.  That’s what I find fascinating.  The Canadian broker market came out relatively unscathed after 2008, and yet broker market share in Canada is not growing.  The data would suggest that broker market share in Canada is actually contracting; so what is it about Australian broker market  that enables them not only maintain their market share but actually grow it?  That’s going to be the first question I ask of any stakeholder in Australia.  I hope to garner some insights and to see if there’s some practical application to our market, given examples from Australia.

What I’m really looking forward to is talking to lenders and brokers who fully embrace a trailer fee model.  Brokers and lenders in Australia are vested and fully committed to this model.  So what I hope to gleam is, how did they get there?  I believe the trailer fee model is now accepted by the broker community in Canada.  It’s no longer viewed as the boogieman or the great unknown.  In large part this is due to Merix’s commitment towards this compensation model, and it pioneering of the trailer fee model.  Many lenders talked about in the past but Merix actually did it.  I commend all the broker lenders in Canada that have created a hybrid of the Merix model.   Lenders in Canada can call them renewal fees if they like but the fact is prior to Merix, lenders were not paying on renewal.  My hope is that every lender jumps on board and helps to create future value for mortgage brokers in Canada.  Who knows, maybe one day Aussie brokers and lenders will ask us, how did you do it?

Until next time


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0 Comments Candidly Speaking – Part 2

Article written by on the 07 Jul 2011 in Lenders,Mortgage

As per my previous blog, I will now address the second question I answered as a panelist at the VERICO Business Forum . “What is one thing that a lender can do today to ensure long term sustainability, and what can mortgage brokers do in kind”.

Simply stated there is no one thing that a lender can do today to ensure long term stability. Usually when we’re asked these questions, in a public forum, the answers are sprinkled with ambiguity, and a pinch of fluff. The reality is, if a business is going to be relevant tomorrow it requires careful planning, and a wee bit of luck.

Careful planning requires a full understanding of your customer’s needs.  Sales today is far different than it was years ago.  The customer is far more sophisticated today, as is the sales person.  At Merix we serve two customers, the borrower and the mortgage broker.  For too long in this industry the mortgage broker has been viewed simply as a conduit between the borrower and the lender.  This has to change.  The evolution of this industry requires that we change how we treat our customers, the mortgage broker.

I believe greater transparency is required between the mortgage broker and the lender.  Our dialogue and operating practice has to change.  We will not be able to thrive and grow our business if we continue to work in an environment where one entities profit is another entities loss.  Long term sustainability of our industry requires the broker owner, the mortgage broker and the lender to profit.  If one of these three is left out of the profit equation the industry is doomed for failure or at the very least stagnation.  Therefore, I believe lenders have to become more transparent about their own business.  If every conversation is about more VB (Volume Bonus) or higher finder’s fee, it’s a race to the end.  The challenge we face today is in understanding one another’s business. We’ll never get there unless we present the facts.  The only way we’ll all be able to grow is by giving each other a look behind the curtain.

In terms of what a mortgage broker can do to ensure long-term sustainability?
Be prepared to face two significant challenges, customer retention and increased competition from the bank’s mortgage sale’s force.

Customer retention is the nasty little issue that no one wants to discuss in an open and honest way.  So I’ll give it a shot. There’s isn’t a lender out there who doesn‘t believe that once a broker accepts the finder’s fee and VB, the customer belongs to the financial institution.  Mortgage brokers believe the lender is renting the customer for five years. I can assure you that every lender you deal with, including MERIX, is allocating more resources to customer retention.  Every lender will fight tooth and nail to retain the customer, and so far lenders have been very successful. For illustration please note the most recent CMHC survey relative to customer retention. The banks are winning the customer retention game, and they plan on keeping it that way.

The second significant issue mortgage brokers will have to confront is increased competition from bank’s mortgage sales force.  You’re probably familiar with the two banks that dominate the space today, but I can assure you that all the banks are either investing in that channel today or they’re about to do so.  I mean all of them.  The banks learned from the broker channel.  Subject matter expertise, and a focus on service, is a formula that works.  Imitation is the highest form of flattery, so mortgage brokers be flattered.  That being said, the banks are coming, and they have deep pockets.

Until next time,


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    "I work in a world of numbers, process, execution, risk mitigation and all kinds of other sexy stuff. To share my thoughts, opinions and personal tidbits does have some creative appeal for me. It will also push me to do something that I am not totally comfortable with, writing. Get me in front of a room full of people to do a presentation and I'm on. Writing a story that others may actually be interested in reading sounds like a challenge to me. The reality is that I enjoy a good challenge and if it ends up that mom is the only reader of my blog so be it."

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