Expect further changes at mortgage broking firm Loan Plan this year following director Chris Barneo selling his third stake to New Zealand Finance with the blessing of his two partners.
One of the two remaining directors, Paul Bright, says the two companies have an agreement in principle but he isn’t ready to reveal their plans yet.
But Loan Plan will still remain an independent broker. "The fact that they have an investment in us doesn’t change Loan Plan at all. We still see ourselves as an independent broking firm who will seek the best service for the client," Bright says.
New Zealand Finance already lends to Loan Plan clients but will continue to do so only on merit, he says.
John Callaghan at New Zealand Finance, who has taken up Barneo’s directorship, agrees the Loan Plan brand will remain intact and keep its independence, although back-office administration will be streamlined wherever possible.
His company already has a seven-person mortgage broking team who are free to offer clients the best deal they can find, regardless of who the lender is.
"It’s in our interests that our brokers do present the best deal. Otherwise, the clients will quickly go elsewhere," Callaghan says.
He says buying the stake is part of his company’s plans to grow through strategic alliances. Owning the stake is already bringing noticeable benefits.
"We’re already getting more volume of business (from Loan Plan). We’ve already had a relationship, but it’s been cemented a lot harder by having that ownership structure. We’re more visable and in your face," Callaghan says.
New Zealand Finance has chalked up impressive growth recently. In the year ended March 2001, total income was $2.178 million and pre-tax profit was $661,000. In the six months ended September 2001, total income was $2.148 million while pre-tax profit jumped to $818,000. Callaghan says October, November and December have all been strong months and the company is on track to record a full-year pre-tax profit of about $1.6 million.
The company has about $24 million in on-balance sheet assets and about $14 million off-balance sheet in mortgages securitised through AMS.
