MMC's freshly-crowned president/CEO talked to MBN about the lessons he learned in the brokerage world and how he hopes to put them to work for both his new employer and Canadian consumers
To say the least, Albert Collu has had an interesting view of the COVID-19 pandemic. In April, when the coronavirus was curb-stomping the Canadian economy, Collu, as president of M3, was preparing to lead the company through a period of unprecedented turmoil. A month later, he was gone.
In June, Collu resurfaced as Marathon Mortgage Corp.’s newly crowned president and CEO, an announcement surprising for both its suddenness and the relative obscurity of the company involved. Why, many wondered, had Collu gone from representing an industry Goliath to loading up the slingshot for one of its many David’s?
Collu took a few minutes out of a hectic Monday morning to talk Mortgage Broker News through the transition and the plans he has in store for MMC. The following interview has been edited for length and clarity.
Mortgage Broker News: How would you characterize your time at M3? How did you feel about how things ended there?
Albert Collu: I would probably say this: My time there was appreciated. I valued the time there, but I just felt, personally, that it was time to make a change and look for something a little more rewarding in terms of my own personal interests. I’ve always had this little fire that I could not put out, which was actually to return to the lender space, which is essentially where I started my career.
I would say that my decision to depart wasn’t reflective of M3 in any way, shape or form. It was just more of a personal desire to do something different. Nothing more, nothing less.
MBN: What’s the appeal of getting back to the lending side?
AC: For me, I always felt there was a great opportunity to bridge the gap between broker and lender. And that’s not me being cryptic about any of the lenders doing a poor job, but when you spend a great number of years on the broker side, you realize that there’s such a delta between the education level that could be imparted to brokers in terms of what a lender goes through – their challenges, their plight, how things actually work behind the scenes. For whatever reason, in my view, lenders have been pretty reticent about sharing a lot of those things. I’m of the opinion that those things can be shared, and that will make us all better, particularly the broker when they’re sitting mano a mano with the consumer.
Moreover, I’ve always had a deep passion and appreciation for how one moves through the capital markets and turns that into a mortgage product that helps Canadians. That’s a lot of fun to me.
MBN: That transparency between lenders and brokers, is there a reason why you think it’s not quite to the level that it needs to be?
AC: I don’t think it’s out of malice from the lenders or banks. I think it’s actually just an underestimation of how important those things might be to brokers. There may be an undercurrent at the lender level that says, ‘These are really the mechanics of operating a lending or bank business, so we don’t really need to impart these things.’ That’s one bucket.
I would say the second bucket – and it’s fair, by the way – is that maybe there’s some reticence in saying too much in terms of what a strategy might look like, what a funding relationship might look like. So I get some of that for sure.
MBN: What were some of the more valuable lessons you learned on the broker side?
AC: At M3, there’s so much I learned. It’s hard to even capsulize. As it relates to the broker directly, I’ve come to really appreciate the battle they go through.
I don’t know that the world at large understands the battle. They have to go from ground zero to start a relationship with a consumer, track that business, and, even in bringing that relationship to the table, there’s still quite the journey to win that business. Offset that with the other challenges they face within the industry: keeping efficiencies, making sure they’re putting forward quality paper, training brokers that may or may not be under them.
The broker does not have a very smooth flight. They’re always facing turbulence. I’ve grown such a deep respect for what they have to encounter every day.
MBN: So, why Marathon? Of all the companies out there, why is Marathon the fit right now?
AC: (laughs) That is the big question. Did I think I was going to get job offers within weeks of [leaving M3] during a pandemic? Not a bloody chance. I did not see that coming. It was actually quite overwhelming and flattering.
At first, I had zero desire to pursue a conversation with Marathon. My first pass was very polite. When I was asked to enjoy a coffee with some of the major board members and the shareholder group, there was a question that was haunting me that I couldn’t answer: Why the hell is anyone not really using these people? From the outside looking in, it appears to be a great recipe: This company has incredible pools of funders, more so than the market is aware of, and it has an incredible compensation and rate package.
So, as I dove in, I realized that there were two things that were fundamentally missing that we could change. The first one is quite easy, and that’s awareness. The challenge has also been that service has been sub-par. There’s no mincing words about that.
But now I’ve got a shareholder group, a board and a pool of funders who are so behind what we’re doing: adding to the organization so we can be everything we need to be for brokers.
MBN: Do you find that there are more limits on being honest and transparent when you’re working for a lender versus when you’re working for a brokerage?
AC: No, not at all. In fact, I’m more perplexed why there’s still a lack of willingness to share information as a lender. It doesn’t disaffect the journey ahead for us. If anything, I’d say that transparency [between lenders and brokers] allows us to become closer-knit because we understand each other’s businesses a lot deeper.
MBN: What are your plans for Marathon, both short-term and big picture?
AC: Short-term, a complete review of all the systems and processes is well underway, which really just leads to the main goal of ensuring our service goes from sub-par to quite excellent. We know who we are. We’re not fooling ourselves. We have great products that are insurable; that’s homogeneous, so we know that we have to win this fight by being very clear on what we do, how we do it, and servicing the heck out of brokers in a way they deserve.
We’re currently looking for a whole crop of talent, everything from sales to marketing to financials, to augment the team. Related to hiring would be really creating a market identity and being more proactive with media outlets.
MBN: What’s your plan for helping consumers?
AC: I’ve often made comments about what consumers should look out for to clear some of the noise because so much changes every day. When I was on the broker side, the information I got may have been delayed a little bit by the time it filtered down to my channel. Now, I’m right at the precipice of actually seeing that information evolve, whether it’s insurance policies, a change in capital markets, or anything like that.
I think my journey to help consumers in terms of providing information at the critical moment when they make a decision is probably enhanced, more so than it ever has been.
MBN: I wanted to get your read on where Canadian home buyers’ heads are at. Even though most of the people left jobless by COVID-19 are still out of work, prices, in some key areas at least, are soaring. CMHC is predicting a fall in prices by as much as 18 percent, but people are still fighting each other in bidding wars. Thousands of people have deferred their mortgages, thousands of Airbnb investors are getting hammered every month. What’s your take on it?
AC: I think there’s a few things that converge. First, we’re all dealing with something we’ve never dealt with in this COVID situation, right? So everyone’s taking best guesses on the fly. Some people were closer to the truth, some were way off. Number two, because of COVID, I think those that have been in a stable financial situation regardless of the pandemic may have been starting to speculate that, ‘Okay, maybe this is a good time to buy. I may be okay.’ Another one, when you have the Bank of Canada saying, ‘Listen, these rates are ridiculously low and we have no intention of changing them for quite the long forecast,’ I think that stimulates a market at play.
We all understand that there may have been pent-up demand. We get that. But it doesn’t really speak to why valuations are being positively impacted. No one can really put their finger on that. Nor can anyone put their finger on multiple bids.
MBN: It’s like the NYSE rallying even though 30 million Americans are still out of work. It’s completely divorced from the realities of mass unemployment. Do people not think in terms of six months from now, eight months from now? I’m baffled, and I’m wondering if you guys, who are in charge of getting the money out there have a better handle on what people are thinking.
AC: I think your six- to eight-month window’s an interesting one because I think there might be a belief at the consumer level that, ‘Geez, I can get myself a really good deal right now.’ Kind of like the stock market – there’s no shortage of investors or day traders thinking ‘My god, I’m getting this at a blast price.’
That’s my view. But who the hell knows? We’re all guessing at the moment.
MBN: Are you guys hedging for a downturn?
AC: I’m not hedging for anything but growth. We’ve had such soft performance for a company that’s been largely unknown that, regardless of any economic activity, for us, the way is up.
If we were more developed and more seasoned like some of our competitors, who we totally respect, I would probably say that we may have seen the bottom of it and now we’re slowly getting to the surface. That’s my view.