NZMBA vote overwhelmingly in favour of PAA move

New Zealand Mortgage Brokers Association (NZMBA) members have voted overwhelmingly in favour of it being subsumed within the Professional Advisers Association (PAA).

Thursday, March 15th 2012, 9:10PM

by Jenny Ruth

Interim NZMBA chairman Shaun Riley called the vote "a defining moment for the mortgage broking industry."

With mortgage broker numbers having reduced in the wake of the global financial crisis, brokers now offering a wider range of financial advice, and regulation now in place "we need a better-resourced, stronger body," Riley says.

The move will mean members will have better services and stronger representation while keeping costs down.

"Amalgamation is the most sensible way to protect all members' interests in the new environment," Riley says.

To pass, the vote needed at least 75% of the NZMBA's 409 paid up members to vote in favour. In the event, 85%, or 347 members, supported the move and they accounted for 98% of those voting. Only three voted against and there were four abstentions.

The NZMBA will now be wound up, its non-financial assets, including the NZMBA brand, training services and awards, and its two staff will be transferred to the PAA.

The remaining financial assets after all obligations are settled will be distributed back to members. Treasurer Stephen Wilton says that should be between $150,000 and $200,000, or between $366.75 and $489 per member.

PAA charges its members $46 a month, or $522 a year.

Next Tuesday, PAA members will vote on measures to fast-track NZMBA members joining it and some necessary constitutional changes.

If all NZMBA members join the PAA, the combined association will have more than 1,200 members. A number of the major mortgage groups require their advisers to belong to an industry association.

Riley, who is also chief executive of Mike Pero Mortgages, which requires its franchisees to belong to the NZMBA, says his company will now require franchisees to belong to the PAA.

A driving imperative for the move to PAA was financial. Wilton says NZMBA charged its members $795 last year and, without the move to PAA, fees would have had to be higher this year because the NZMBA ran at a loss of about $25,000 last year.

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