Mortgage Choice In Credit Union
The Age
Friday April 12, 2002
Fast-growing mortgage-broking network Mortgage Choice has secured $9 million in equity from an unlikely source - three of Australia's largest credit unions - ahead of a possible public listing next year.
Mortgage Choice's controlling shareholders, Peter and Rod Higgins, have sold down their stake to 70 per cent and intend to reduce it to 50 per cent ahead of the float.
The credit unions, Australian Central Credit Union, Australian National Credit Union and Credit Union Australia, will also join Mortgage Choice's panel of 20 lenders.
The chief executive of the Sydney-based Australian National, Rob Nicholls, said the credit unions hoped to account for about 10 per cent of Mortgage Choice's $500 million in monthly home loan approvals.
This would translate into an approximate doubling of the credit unions' current combined monthly lending volumes through their existing channels, Mr Nicholls said.
The investment of $3 million each marks another attempt by the credit unions to find a place in the crowded financial services market.
Mortgage broking, whereby advisers select the best loan from a panel of lenders in exchange for a commission, is rapidly replacing fixed-cost channels such as bank branches and mobile lenders as the preferred distribution channel for new lending.
Mortgage Choice's joint executive chairman, Peter Higgins, said the equity stake valued Mortgage Choice at $110 million.
© 2002 The Age
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