Expect some new competitors in the mortgage business. We heard there are over 30 new bank and trust applications awaiting approval at OSFI, Canada’s banking regulator.
As far as we know, they’re mostly small players, but that’s okay. Small players can fill important niches.
There’s no word on if/when the bulk of them will be approved, or how many will actually enter the mortgage market.
One interesting note, according to an observer we spoke with, is that smaller banks and trustcos may be more open to white-label arrangements with brokerage houses. (Big mortgage brokerages all seem to want their own white-label products these days—even though very few private-label products are noteworthy in terms of rate or features.)
Hmmm…new banks and trusts…how long will they last? I remember Dundee Bank of Canada being bought out by BNS and Citizens Bank of Canada not ceasing operations with mortgage brokers. BMO did the same. On the other hand some unemployed underwriters may have a job soon. But I won’t hold my breath.
…correction…that was supposed to read “ceasing operations with mortgage brokers”…
Hi Steve,
Thanks for the note. Consolidation is a natural part of the business and lenders come and go. On a positive note, I’ve heard of two lenders who plan to come on line in the next 12 months and enter the broker market. We’ll see what happens…
Cheers,
Rob