Non-bank lender Liberty Financial is looking to broaden the brokers it uses after it was dropped from the lender panel for a major mortgage broker while its agreement with a second broker is in flux.
Liberty, which is expected to list as a $1.8 billion group on Tuesday, has been removed from the lending panel for Connective Services which has been estimated to account for about 23 per cent of the loan introducer market.
Its agreement with another major broker, AFG, is also up in the air, industry sources say. Liberty declined to comment on commercial arrangements. There are expectations in the industry that a new agreement with AFG will be inked shortly between the two groups.
Liberty says in its prospectus it is looking to diversify the loan introducer groups it uses and is not dependent on any one group. “As contracts may not be renewed from time to time, Liberty continues to diversify its origination sources so it is not dependent on any one group for new business.”
“For example, a termination with Liberty’s largest introducer group would not be material to the FY21 forecast and its non-renewal would cause resources to be directed to other valued business partners and initiatives.”
AFG declined to comment when contacted by The Age and The Sydney Morning Herald about the issue last week.
The concerns about the agreements come as AFG’s attempts to buy Connective Services have been rejected by a shareholder in Connective that is owned by a senior Liberty Financial staffer.
Before AFG lobbed its offer, that staffer took legal action to increase his stake in Connective alleging his rights were oppressed by other shareholders. Liberty is funding that legal action but is not involved in the case. That legal action revealed Liberty had not documented a promise of an $82 million loan to the staffer to help acquire a larger stake in Connective if he wins his case.
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Source: Thanks smh.com