ING’s broker links could hamper sale

ING’s broker links could hamper sale

ING’s broker links could hamper sale

As attractive as ING Direct Canada may be to prospective buyers, its use of brokers will likely deter the biggest of those suitors, according to one analyst.

ING’s thriving relationship with the mortgage broker channel may in fact make the alternative bank less appealing to the likes of Bank of Montreal, Royal Bank and CIBC, according to John Reucassel, bank analyst for BMO. That’s because, these lenders have actually left or no longer use the channel.

However, TD and Scotiabank, respectively the country’s second and third largest banks – as well as National Bank – may have the “greatest strategic interest” in ING, said Reucassel.

ING’s laser-focused interaction with mortgage brokers has been credited for its success in competing with the country’s Big Five. When the Dutch-based bank entered the Canadian market in 1997 it relied on those mortgage professionals to wage war with the established Canadian lenders without having to invest millions of dollars in capital expenses to create an expansive branch network.

While that helped ING Direct amass $31.5 billion in residential mortgages and about $4.75 billion in deposits last year, it won’t necessarily appeal to RBC and others firmly situated outside the broker channel.

Still, that may be good news for brokers who’d like to see ING remain a broker-friendly lender instead of having its book transferred to the buyer’s branch system.

  • @kiltedbroker 2012-08-16 3:35:59 AM
    Those are some pretty strong fighting words from BMO.

    As a broker channel we need to strengthen our resolve to support the mono-line lenders and stop wasting out time sending our clients to the banks. We need to create our value proposition on service to our clients and work tirelessly to be valuable business partners for our lenders. If we don't make a move soon, BMO and the others will continue their slow methodical campaign to squeeze the life out of us.

    Don't think there is a war here? Think again.
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  • Bluenose 2012-08-16 4:24:09 AM
    Once again, negative comments directed against mortgage brokerage community by the usual culprits. I would like to hear their comments explaining why the consumer is better served by a mortgage development officer representing a bank, rather than a mortgage broker with multiple lenders to choose from.
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  • Chad 2012-08-16 5:16:58 AM
    Bluenose, you have it all wrong. BMO left the channel for exactly that reason. The brokers made sure they had to be competitive and fair on products and rates. The consumer is better served with choice. The Shareholder of the bank who is reality is all the bank cares about is better serviced with sales force as they are forced to cross sell poor products and sell higher rates.
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