Larry Fayle on Manulife Bank of Canada

Adrian:

I'm joined today by Larry Fayle, who is with Manulife Bank here in Winnipeg. Larry, could you tell us a little bit about yourself and your role with Manulife Bank?

Larry:

Sure. Thanks, Adrian. My background spans over 30, 35, 36 years in the banking industry. Spent a good chunk of my career with Scotia Bank and, most recently, with Manulife over the last four and a half years. So I love the banking industry, obviously, as a business development manager on the broker side with Manulife. I've been in that role exclusively over the last four months, but I spent the last four and a half years working on both channels, with the advisor channel and the broker channel. As the bank made some critical decisions in latter part of 2020, they did separate the channels, I consciously moved to the broker channel for different reasons.

Adrian:

Now, what makes Manulife Bank a unique mortgage lender in Canada?

Larry:

When you mention the word Manulife, I would say 80% of our Canadian population recognizes that name and the brand, whether it's in the healthcare sector, the insurance sector, and maybe even the banking sector now. But I think the brand really resonates with the Canadian consumer, and most people have heard of the term, Manulife.

Larry:

Couple of other things I would say that makes us really unique in this space, we're one of, really, a handful of lenders, if you can find them, that has the Manulife One concept with a HELOC attached to it. So Manulife introduced that concept and brought it to Canada 26, 27 years ago, and they adopted that from a Australian bank. And so I think that HELOC feature, with your mortgage attached to it, gives the Canadian consumer tremendous flexibility in really managing their finances and really being independent on their own with their bank.

Adrian:

Now, can you dig just a little bit deeper into what is Manulife One and who is it ideal for?

Larry:

Well, Manulife One, quite honestly, I would say it's probably for 95% of the market. And the reason I say that is because we've got six different mortgage programs that really meet the unique needs of the Canadian consumer. You could be a professional, you could be self-employed, you could be an individual that has a rental portfolio, you could be just a regular Canadian that's just looking for a traditional mortgage. We meet, I would say, 95% of the market's needs, quite frankly, in Manulife One.

Larry:

I think what sets Manulife One apart is the consumer will have the flexibility to structure their mortgage or their debt the way they want. And so what I mean by that is, that the broker's going to present some different options based on the consumer's goals and objectives, and they're going to structure that deal as per the consumer. And so that's a little bit different, because if you typically walk into a branch, that personal banking officer is going to throw some options based on what they're looking for and maybe the mandate of the bank. And I think from Manulife One's perspective, if it's presented properly, the consumer really takes the lead and says, "Hey, based on our goals and cashflow, I'd like the deal structured this way." And so I think that really gives us a edge if it's presented appropriately to the consumer.

Adrian:

Now, you recently launched a new conventional mortgage product, that being for borrowers that have 20% or more down payment or equity. What is its value proposition compared to a conventional mortgage, perhaps from one of the big five chartered banks?

Larry:

Well, I would say, I mean, there's some subtle differences to the program, at the end of the day, but when you look at the big picture, I think when you looked at our product shelf, there was a bit of a void and we didn't have that conventional product. We did, we took it out of the market, now we're back in the market. And so based on broker feedback over the last number of years, we've made a conscious decision to really reintroduce the conventional product, and I think it fills our product shelf really nicely. It gives the consumer, once again, another choice and another option at the end of the day.

Larry:

Because let's just say, hypothetically, the consumer says, "Hey, listen, I get the value, and I get the benefits of Manulife One, but I'm just really stuck on a straightforward conventional product." And if you look at our product, it'll meet that consumer's needs. And you look at even how the rates are tiered, clients have options, right? Now, when you sit with a client, you've got another program to present that really meets your client's goals and needs. So is it any different than the big banks out there? Slightly, but very similar at the end of the day. But once again, it fills our product shelf nicely.

Adrian:

Now, you mentioned that you spent a big part of your life at one of the major chartered banks. Many people have a default trust in their financing or financial institution. Why should they consider shopping their mortgage needs using a professional mortgage broker instead of just walking into their bank branch?

Larry:

Well, these days it boils down to really choice and options. All banks have a mandate, they have their agenda, they have their targets, they think about the shareholder. And what I do appreciate about the broker industry quite frankly, is that they really have the client's needs at heart, and that really is their business, right? And so I think there's not a straightforward loyalty to one particular bank, at the end of the day, when you're dealing with a broker. The broker deals with many different institutions. They have that availability of dealing with many lenders and so forth.

Larry:

And I think clients want options these days, they want value. And so I think when they sit with a professional broker that understands their goals and their objectives, it just creates an atmosphere of, I would say, relief, to be honest with you. Because there's no pressure from the banks to sign that deal or move forward with that particular bank. And the broker is looking for the best options for their client, based on what that client's looking to accomplish over the next four or five years.

Adrian:

When I'm sitting down or, or at this time, obviously not sitting down, but discussing mortgage options with a client, why should a client consider Manulife Bank as their mortgage lender of choice?

Larry:

Well, Manulife, it's been around for 26, 27 years. I think a couple of different things that stand out is, once again, we've got six or seven different programs that'll meet the needs of 95% of the Canadian consumers' options out there, at end of the day. Whereas, most banks may present one or two different options, whether it's conventional or high ratio or near to Canada. Manulife's got six or seven different options, quite frankly, and that really sets us apart.

Larry:

Couple other nuances is that for us to differentiate ourselves in the industry, some of our policies are slightly different than the big banks, and I'll give you a couple of different examples. Not many banks will allow a consumer to have two primary residence, to finance two primary residence. We will. Our sliding scale in the market, from what I've been told from the broker industry, is second to none. When you have a sliding scale that allows 80% of the first million and a half, that covers a good chunk of not only the Winnipeg market, but the Western Canada market. And so I think if you're a broker and you deep dive into some of our programs and policies, you'll understand what really differentiates us from the big banks at the end of the day.

Adrian:

Now, you mentioned before we started recording, your desire to stay in, be in Winnipeg, and that's part of what made you make some of your career choices. So you must have a certain love for Winnipeg. What do you love about Winnipeg real estate?

Larry:

Well, Winnipeg real estate is A, top of mind, very secure, very stable, you know what you're getting in Winnipeg, really, at the end of the day. And I think, too, we don't go through the same cycles that maybe an Alberta market goes through, where homes appreciate by 20, 30, 40%, maybe higher, whatever the case may be. In Winnipeg, it's pretty stable.

Larry:

But the thing I really like about Winnipeg, Adrian, it allows everybody to come into the market. Everything is priced accordingly to really meet a lot of consumer, their demands really, at the end of the day, right? So the average price might be around 300,000 today, that allows affordability for the young professional or a young family to come into the market. And that's what Winnipeg real estate really gives the city of Winnipeg at the end of the day. Quite honestly, that sets us apart from some of the bigger cities across Western Canada.

Adrian:

Yeah. It's definitely steady Freddy all around and very safe. One of the things that I love about Winnipeg real estate is obviously, it's consistency, but it also has consistent growth rate. The last 20-year average, we see an average of 6.5% a year increase in single-family home values. It's the average based on the Winnipeg Real Estate Association. I don't know many markets in Canada where you would see that sort of an average. Now, have we had the major increases, like Vancouver or Toronto, or perhaps Calgary, some of the declines? No. But very dependable, and like you said, there's definitely real estate ownership options for, really, all levels of consumers.

Larry:

Now think about that stat you just threw out, Adrian, 6.5% steady growth over a number of years, right?

Adrian:

20 years average. Yeah.

Larry:

So think about that number over 20 years. Where can you go right now and get a steady rate of growth of an average of six and a half percent in your investment portfolio? You're going to have to take some risks. But real estate in Winnipeg will return that for you. So if you're looking for a viable option to the market, then you should be looking directly at the real estate market in Winnipeg that's going to pay you that six and a half percent average. That is tremendous at the end of the day.

Adrian:

Yeah. Now Manulife Bank's got a product for first-time home buyers, for existing home buyers, for switch transfers, for rental property owners and people who need conventional mortgage financing. Like you said, you've got a full range of options for the Winnipeg and Manitoba and Canadian mortgage borrower.

Larry:

And I think, too, Adrian, once you've been with Manulife and you understand the program and the product, you're not going to leave the company at the end of the day, because you can take the Manulife One right into retirement. You can use that to really supplement your cashflow in retirement, with your various sources of cashflow. And so that's what folks like about the service and the program is that, that Manulife One program stays with you right through your entire life cycle if you want. It's a way of reaching in and taking some of that tax-free equity and using that in retirement.

Adrian:

Thank you for your time today, Larry.

Larry:

Yep. Thank you, Adrian.