CAFBA Annual Review 2022-2023

Annual Review 2023

Commercial & Asset Finance Brokers Association of Australia The national peak professional body of Commercial Finance Brokers

Professional Development Our Mission Our work is to grow and support a diverse profession of commercial and asset finance brokers.

Market Outlook Our Vision When our work is done business will have access to finance to start, maintain & grow.

Representation

Leadership Diversity

Contents 1.

President's Report

2

2.

CEO’s Report

3

3.

CAFBA Board and Staff

6

4.

CAFBA Affiliate Members & Service Providers

8

5.

CAFBA Strategy & Implementation Plan 5.1 Education 5.2 Self Regulation 5.3 Advocacy 5.4 Member Value - Diversity and Inclusion

9

6.

Commercial Finance Market Overview 6.1 Commercial Property Finance 6.2 Commercial Equipment Finance

18

7.

CAFBA Membership

21

8.

Women of CAFBA

21

9.

Leadership Scholarship Program 9.1 Women & Leadership Australia 9.2 Inclusive Leadership Program

22

10.

CLYP Commercial Lending Young Professionals

23

11.

Awards

23

12.

Financial Summary

29

13.

Honour Board

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Annual Review 2023

President's Report 2023 has been another year of meaningful progress for CAFBA. I am very proud of the board, the staff, our members and the industry we serve, for the work we have collectively achieved. The association has continued on its journey towards the Professional Standards Scheme (PSS), which is set to transform commercial broking and ensure the industry's selfregulating status in the long-term. Board Member George Karam has skillfully lead the committee overseeing this transformation, and there has been much work carried out in the background to get us to the point where we will be ready to submit our first module to the scheme in early 2024. destination that graduates aspire to when assessing their career options. While there remains much work to be done in this space, I am extremely pleased with the progress CAFBA has made.

CAFBA's adoption of the PSS is the single most important development in the commercial and asset finance industry since NCCP2 was defeated.

It will future proof our industry and ensure customer outcomes are enshrined in everything we do. We expect this journey will take another two years and once it is complete, our members will be recognized professionals. This not only has real benefits in terms of limiting liability and guaranteeing access to insurance, but it also places our members in the top echelon of professionals. I believe this is exactly where our members belong, given our skill and expertise.

Our Women of CAFBA and CLYP committees have been an enormous success. They have regularly sold out their events, which is evidence that there is a real need to create these networking opportunities within our industry. Both groups are key to the future success of not only CAFBA, but also commercial finance more broadly. I would like to thank Sharon Piening, Chair of Women of CAFBA, Max McFarlane, Chair of CLYP for their tireless efforts and everyone who has taken part.

Education continues to be central to CAFBA's strategic vision, and earlier this year the Education Council successfully launched the Certified Lease and Finance Professional (CLFP), the preeminent credential for equipment leasing and financing professionals throughout the world. It took many years of hard work by Education Council Chair Terry Moody, David Gill, David Gandolfo and others, to bring the Australianised CLFP to life, which included adapting the curriculum to Australian accounting, regulatory and tax standards.

On a personal note, my term as President of CAFBA finishes in November this year. It has been a privilege to have been able to work with the board and management of CAFBA to serve our members. I would like to thank everyone for their support and look forward to remaining on the board as CAFBA enters an exciting stage of its evolution.

The launch of the CLFP means that we now have a clear education pathway through the industry, beginning with the Certificate IV, moving into the Diploma and culminating in the CLFP. Our research shows that university graduates look to an education pathway when choosing an industry. CAFBA is aspiring to make the Commercial and Asset Finance Industry a

Matthew Atkin CAFBA President

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CEO's Report I have joined CAFBA as CEO at an exciting and important time for the association, and for commercial and asset finance in Australia at large. The industry is currently experiencing a period of significant change, with non-bank lenders acquiring a larger share of the market, and a spate of brokers from other sectors looking to diversify into commercial finance. Amid this change, it is incumbent upon CAFBA as the peak national body representing commercial and asset finance brokers, to ensure that our members continue to operate under a self-regulating framework while upholding a level of excellence in the service they provide. supporting and further developing our educational offerings, to ensure our members stand out as the most knowledgeable, capable, and ethical representatives of the industry.

Since taking over the role in October, I have been busy meeting members, lenders, aggregators, politicians and other stakeholders important to CAFBA and its members, and I have thoroughly enjoyed delving deeply into the operations of the association, as well as gaining a broader understanding of the work our members do day-today.

I think we all know the risk of our industry being just one bad news story away from unwanted and unneeded regulation. The work towards higher standards and the further professionalisation of commercial and asset broking will go a long way to inoculating CAFBA members from badly thoughtout legislation. But CAFBA members being professional, knowledgeable, and ethical, and effectively self-regulated, won't protect us from regulatory imposts if decision-makers are not aware of that.

My transition into the role of CEO is being made much smoother as a result of the overlap between my starting and David Gill's retiring, and I commend Matt Atkins and the Board for making such a wise decision. As the inaugural CEO and having held the position for the past 11 years, David is the custodian of an enormous wealth of knowledge about CAFBA, its history and operations, the challenges its members face each day, and the course the association is charting as it continues to progress into the future. Working closely with the Board of Directors, David's work has helped CAFBA develop into the professional peak representative body it is today and his legacy will long be felt.

As a former Senator and diplomat, I understand deeply the processes of policy and regulatory development and look forward continuing the great advocacy work CAFBA has done over the past decade or so, especially through David Gandolfo, and continue to grow the high level of awareness of CAFBA and the professional nature of its members.

Looking forward, I hope to work with all of our members, in partnership with the Board, to continue not only the professionalisation of CAFBA, but also the business of commercial and asset broking, with the end result of CAFBA members being widely recognised as both members of a respected profession, and trusted advisors to their clients.

As I start my journey with CAFBA, I am acutely aware that the association exists to represent and advance the interests of its members. This will be the filter through which I run all decisions made for so long as I am fortunate enough to be in this role. I am honoured to be the new CEO of CAFBA and am here for you, its members.

CAFBA has long held the view that a self-regulating framework founded upon education ensures the best outcomes for commercial borrowers. The key to maintaining commercial broking's selfregulating status in the long-term is through education and professionalisation. Formal recognition of CAFBA members as professionals through the Professional Standards Scheme is one avenue that I am very keen to pursue, along with

David Bushby CAFBA CEO

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Annual Review 2023

CEO's Report Retired October 2023

CAFBA continued to evolve in 2023, as we entered the penultimate year of our current Strategic Plan.

Building on the important progress already made, we secured significant advancements in a number of key initiatives that are shaping the future of our industry, further establishing the association at the very forefront of commercial and asset finance in Australia.

In adopting the PSS, there is not only a benefit to commercial brokers, but also to lenders and clients, who will know that commercial brokers are committed to upholding a level of excellence in their service and who will be guaranteed a standard of professionalism throughout the industry at large. 10 years on from the NCCP decision, the adoption of PSS looks to be another watershed moment for our industry.

Foremost among these initiatives is our pursuit of the Professional Standards Scheme (PSS). Last year, the Board decided the adoption of a PSS was the best course for the association to take in order to achieve our strategic goals of further professionalising our industry and ensuring its self-regulating framework in the long-term. Under the stewardship of George Karam, Chair of the Self-Regulation Committee, CAFBA is now ready to begin its PSS submission process in early 2024.

This year also saw the first intake of candidates for the Certified Lease and Finance Professional (CLFP), another significant development to CAFBA's commitment to education as means of maintaining our industry's self-regulating framework, while also offering aspiring commercial brokers a clear pathway into commercial broking. The acceptance of the inaugural cohort of CLFP applicants was the culmination of years of work, particularly by CAFBA's Chair of Education Terry Moody. Much of this work was around customising the CLFP to meet Australian tax, accounting, and regulatory codes.

This year marked the 10 year anniversary of the former Labor government's decision not to pursue legislation to extend NCCP to small business lending.

The decision was a truly watershed moment for the commercial broking industry, and was the culmination of many years of hard work and lobbying

by CAFBA Life Members David Gandolfo, Kathryn Bordonaro and Terry Moody. The commercial lending landscape, and a commercial broker's role in particular, would look entirely different today if this legislation had been implemented.

It is important to understand the ramifications of this proposed legislation, and to reflect on what might have been. The intended expansion of NCCP to small business lending continues to shape much of CAFBA's thinking moving forward: a key strategic goal of the association is to ensure commercial finance is sustainable in the long-term and remains operating within a self-regulating environment.

As the preeminent credential for equipment and financing professionals throughout the world, the CLFP represents the pinnacle of a commercial broker's education pathway, with the course covering a range of subjects including in-depth examinations of equipment finance products, financial accounting, leasing law, origination channels, sources of capital, asset management and more. Australian CLFP graduates are set to become leaders in our industry, holding themselves to strict standards of professional conduct, while they will also be able to gain valuable international experience through the designation's international recognition.

This forward thinking is the reason the CAFBA Board decided to pursue the Professional Standards Scheme (PSS). In order to safeguard commercial finance's self-regulating environment, we need to demonstrate a level of professionalism throughout the industry. The PSS provides the framework to do this: encouraging commercial brokers to implement a range of measures to improve professional standards and practices, from effective risk management strategies and continuing professional development programs, to codes of ethics and conduct and integrity systems that will satisfy regulators.

The Australian CLFP designation represents a level of knowledge, technical expertise and business ethics that guarantees excellence in service, and CAFBA has always maintained that a better educated, deeply engaged industry will deliver better value to borrowers, lenders, and the Australian economy alike.

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all areas of commercial finance and the forming of the CLYP.

We had a full slate of events this year, with our Annual Awards Ceremony, Professional Development Days, Women of CAFBA Luncheons, CLYP Networking Forums, and CAFBA Golf Days all extremely well attended, and it was a pleasure to see so many of you.

CAFBA is in a very strong position to continue on into the next phase of its evolution, with the professionalisation of commercial broking remaining high on our agenda with our adoption of the Professional Standards Scheme. We have a unique window of opportunity in commercial broking to set our own standards and maintain our self-regulating framework by evolving commercial broking from an industry into a profession. With the current rate of change within the industry, the PSS represents the least disruptive path we can take to ensure our industry maintains the high standards of service we have worked so hard to achieve and presents members with a distinct competitive advantage.

This year CAFBA also hosted our first ever Commercial Property Summit. In 2017, CAFBA made the significant decision to expand its offering to be the association for all commercial finance brokers, not just equipment finance. This has resulted in a large portion of our membership now being solely focused on commercial property finance, with many other members looking to expand their services into this specialised area.

With NSW facing a number of legislative changes that will affect the commercial property market and, subsequently, have flow-on effects nationwide, CAFBA's Commercial Property Summit offered members a chance to hear about these proposed changes and the increased compliance for financiers they will result in, directly from NSW Building Commissioner David Chandler, who was the event's keynote speaker.

The future of CAFBA is in good hands with David, and I wish him all the best in his role as CEO. David's abundant experience in policy and advocacy, and his work in both the private and public sectors will be a great asset to CAFBA as we enter a pivotal chapter in our history.

Finally, I would like to thank the successive CAFBA Boards and our members for all their support and assistance throughout the years, in particular CAFBA's founders David Gandolfo and Terry Moody. My role as CEO has been incredibly rewarding both professionally and personally. We are lucky to have such dedicated and talented people within our industry, and I truly value the many meaningful relationships I have made over the course of my involvement with the association. Watching CAFBA grow into such an important voice for our industry has been particularly satisfying, and I am sure this importance will only continue to grow and evolve over the coming years. Finally, I would like to thank the successive CAFBA Boards, our Head of Operations George Bourgoutjis and Membership Officer Eddie Wellins for all their support.

Advocacy remains an essential part of CAFBA's activities, and I would once again like to thank David Gandolfo, our Advocacy Chair, for all his tireless work in this area. We are extremely lucky to have someone with David's expertise and passion advocate on behalf of our industry. This year David was recognised in the Australia Day Honours List with the Medal of the Order of Australia (OAM) for his enormous contribution to Australian small business. David's unwavering commitment to CAFBA and its values has been a major driver of CAFBA's success, particularly in the association's work in advocating for commercial finance's self-regulating framework, and the award was worthy acknowledgement for his many achievements and ability to influence real change.

I would again like to acknowledge the work of the Board this year and their numerous and significant achievements led by President Matt Atkin and Vice President Dominic Lo Surdo. This is my final address as CEO of CAFBA, with David Bushby having taken over the role in October of this year. It has been a great honour to serve you as CEO over the past eleven years.

I am very proud of the accomplishments we have made, including the education pathways and curriculum we have developed for the industry which culminated with the establishment of an Education Council, our efforts to diversify the industry, particularly our advancement of women throughout

I look forward to watching CAFBA's progress and wish all of you the best for the future.

David Gill CAFBA CEO

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Board of Directors Director Sharon Piening The 500 Group VICTORIA

Director Max McFarlane Skyward Financial NEW SOUTH WALES

Director Jane Lorimer Australiawide Finance VICTORIA

Director Mike Steel RLA Finance Australia QUEENSLAND

Director George Karam BF Money NEW SOUTH WALES

Director Tina Clark Laurentide NEW SOUTH WALES

CAFBA Management Team

Chief Executive Officer Retired October 2023 David Gill

Operations Manager George Bourgoutjis

Chief Executive Officer David Bushby

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Membership Officer Eddie Wellins

Annual Review 2023

Affiliate Members & Support Services Provider Platinum Affiliate

Gold Affiliate

Gold Support Services

Silver Affiliate Bizcap AU Coaxion Finance One Commercial P/L Global Credit Investments P/L

Silver Support Services

Grow Finance Hermes Capital Judo Capital P/L NFC Aggregation Selfco Leasing

Citoplus Pty Ltd Kubio Group Pty Ltd

Bronze Affiliate Alex Bank Angle Finance Arch Finance P/L Asten Capital Astute Financial Management P/L Banjo Loans Cathro & Partners P/L CFI Finance Coex Capital College Capital Australia Ltd Commercial Equity Group Earlypay Ebury Partners Australia P/L Finance New Zealand Limited Fintelligence P/L Grenke Australia Iron Capital Group KOA Capital

Bronze Support Services La Trobe Financial Services P/L Lend Capital P/L MoneyTech Finance P/L Morris Finance Ltd Multipli P/L National Motor Loans P/L Nova Cash Flow Finance P/L Oak Capital Octet Finance Orix Australia Corporate Ltd Private Mortgages Australia Resimac Asset Finance TIM Finance t/as OptiPay TruePillars Unity Bank Viking Aggregation Yellowgate Zagga Market 8

Accendo Financial Institute of Strategic Management O'Maras Optimum Insurance Services Outsource Broker Support Send Payments

Affiliate Members PLATINUM

7

Affiliate Members GOLD

15

Affiliate Members SILVER

9

Affiliate Members BRONZE Support Services GOLD Support Services SILVER Support Services BRONZE

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Annual Review 2023

We hope these CLFP graduates go on to become ambassadors for the program and continue to foster a community within the industry that holds itself to higher standards of professional conduct and levels of excellence in service to deliver better value to their clients.

5. CAFBA Strategy & Implementation Plan 2021-2024 In 2023 CAFBA entered the third year of our Strategy and Implementation Plan 2021-2024.

Building on the foundations of the previous two years' work, we continued to make substantial progress in key areas. This progress was again facilitated in large part due to the sub-committees established to oversee the work, an important initiative which has helped focus the implementation of the Strategic Plan to address core issues.

The graduates have already been able to provide invaluable feedback on the CLFP course structure and content, which will require additional customisation to align more fully with Australian practices. This work will be undertaken with the next intake, scheduled for 2024. Michael Burke, Chief Executive Officer of Coex Capital, was one of the inaugural graduates, and provided the following testimonial: “As a specialised program that provides participants skills and knowledge that are applied to w h a t w e d o d a y- t o - d a y i n o u r w o r k i n g environments, the CLFP is a great example of CAFBA's vision and investment in the continued professionalisation of our industry.”

Throughout its application, the Strategy and Implementation Plan 2021-2024 has encouraged CAFBA to be industry leaders on many issues affecting commercial and asset finance and has effectively utilised the diverse skill set within our membership.

As a reminder, the intention of the Strategy and Implementation Plan 2021-2024 is to play a central role in the commercial finance industry's ability to further professionalise through a coordinated commitment to higher education and selfregulation. Four strategic goals were identified: 5.1 Education: Higher educational standards are to be adopted across the entire commercial financial sector; 2023 marked a significant milestone for CAFBA's Education Council, as we were proud to oversee the first intake of Certified Lease and Finance Professional (CLFP) applicants in Australia. The inaugural class of sixteen candidates represented the culmination of years of work by CAFBA, with the CLFP designation set to change commercial and asset finance in Australia as the industry moves towards greater professionalisation.

This is my final year as CAFBA's Chair of Education. I am extremely proud of the work the association has done in advancing education throughout our industry as a means of best practice, and as a basis on which to further secure our self-regulating framework. I am particularly proud of our achievements in establishing the Education Council.

Founded in 2020 as a joint initiative between CAFBA, the Australian Finance Industry Association (AFIA), and leading financiers and aggregators in

The inaugural class was a marked success, with all 10 candidates graduating. Congratulations to Bruce Debenham, Brent Starrenburg, Gino Defeo, Michael Burke, Nicholas McMahon, Paul Fisher, Paola (Paula) Tirpkos, Ryan Medina, Tala Zabaneh, and Tina Clark, all of who now have the honour of being able to call themselves Certified Lease and Finance Professionals.

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• Detailed overview of the Credit process, including its purpose and evaluation;

the Australian commercial finance market, the Education Council's aim has been to facilitate a consensus agreement among lenders, aggregators and commercial brokers on the establishment of a common qualification framework across the entire commercial finance sector and to ensure content and training are consistent and relevant throughout the industry, whether it is provided to lenders or brokers.

• Documentation and due diligence; • Sources of Capital; • Asset management; • Regulatory compliance; • Customer service; • Portfolio performance The arrival of the CLFP designation in Australia broadens the horizons for established Australian asset and commercial finance professionals. As the CLFP is internationally recognised, the designation provides graduates with the opportunity to work overseas, including in the United States, where predominantly all commercial finance professionals who engage in commercial equipment finance are CLFPs.

All the major lenders and aggregators have joined the Council with this common goal of ensuring we have an educated and qualified industry. These members work together in alignment as key industry participants to foster education as a foundation to facilitate professional standards and maintain trust within our sector.

With the introduction of the CLFP designation, the Education Council has expanded CAFBA's professional education program to include the preeminent credential for equipment leasing and finance professionals throughout the world. CLFP designees demonstrate competency through testing of knowledge, continuing education and a commitment to their business practices and dedication to the industry.

The CLFP credential also presents a structured career path into and through commercial and asset finance. The designation will help attract new and more diverse entrants into the industry, with CAFBA's research showing that expanded educational offerings can attract a new generation of commercial financiers for whom a credential is a necessary first step. Added to this, with the current trend of residential brokers looking to move into commercial lending, it is CAFBA's educational pathway, of which the CLFP is the pinnacle, which can ensure practitioners have the requisite skills, education, and knowledge to operate in a selfregulating industry.

The CLFP covers in depth the information that a professional commercial and asset finance broker in Australia needs to achieve exceptional standards of professional conduct and technical expertise, including: • A history and overview of equipment finance and leasing; • An outline of the participants within the industry;

The introduction of the CLFP is an important moment in the history of commercial broking in Australia. A better educated, deeply engaged industry will deliver better value to borrowers, lenders, and the Australian economy.

• An overview of industry sectors by transaction size; • Outlines of the competition to equipment finance; • A detailed examination of equipment finance products; • The five major drivers of equipment finance and the leasing industry;

Terry Moody Chair of Education

• A detailed look into financial accounting, tax accounting and leasing law; • Equipment finance origination channels; • Sales and marketing tools;

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and operations accepted by the Professional Standards Council and to sign up to its ongoing requirements, which include effective risk management strategies and continuing professional development programs, codes of ethics and conduct & integrity systems.

5.2. Self Regulation: Education, not regulation, is seen as the best way to manage practice rights within the commercial broking industry; It was a productive year for CAFBA's Self-Regulation Committee, with CAFBA preparing in readiness to submit our application to the Professional Standards Scheme (PSS). While the application process has been lengthy and highly involved, there is no exaggerating the significance of this moment for commercial and asset broking in Australia: the PSS will transform CAFBA member brokers into a recognised profession and secure our industry's long-term future.

Many other industry associations operate under this model, including the CPA. Accountants belong to a government recognised profession, and instead of being told how to do their job through prescriptive legislation (as a residential broker is), they adhere to a set of operating and ethical standards that ultimately ensure their customers are protected from unscrupulous practices.

When I was tasked with leading CAFBA's SelfRegulation Committee, I wanted to be certain that all possible courses of action regarding our selfregulating status were thoroughly assessed. These options included both a voluntary code and an Australian Competition and Consumer Commission authorised code. We came to the conclusion, however, that pursuing a Professional Standards Scheme was the most effective measure the industry can take to ensure the continued high-standards of commercial broking and to maintain the industry's self-regulating framework in the long-term.

As part of the application process to the Professional Services Council, CAFBA will be required to establish a limited liability insurance scheme which should benefit CAFBA members through reduced Professional Indemnity Insurance costs. Risks to consumers and to industry will be monitored and addressed through the risk management framework that is currently being developed, and perceived risks can be addressed through continuous education which will be delivered by the Education Council.

The benefits to all stakeholders are obvious. The clear winner will be the commercial borrower, who will know that their CAFBA broker is a professional, bound to a high ethical standard and eminently skilled, and who will be protected by their broker's Professional indemnity insurance.

For the commercial lender, they will also know that the CAFBA broker they are dealing with is suitably qualified and is regulated by a profession which includes standards with a disciplinary framework.

They also know the CAFBA broker is placing the needs of their client first and has appropriate risk measures in place to mitigate and identify risk in their business.

David Bushby presenting at the Victorian Cocktail Event.

As a reminder, a Professional Standards Scheme (PSS) is a legal instrument that binds associations to monitor, enforce and improve the professional standards of their members, and to protect consumers of professional services. Our approach, in effect, is to regulate ourselves; to make CAFBA the regulator instead of ASIC.

For aggregators, the PSS presents the opportunity to re-imagine their value propositions to CAFBA brokers. The CAFBA accreditation reduces their operating risk and oversight requirement under their ASIC licence. Those emboldened to put forward a compelling new value proposition stand much to gain.

This is achieved by reforming CAFBA from a member association to a regulator by having its standards

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In September, CAFBA Patron and Chair of Advocacy, David Gandolfo OAM, was appointed to the advisory stakeholder group led by the Minister for Finance, Senator the Hon Katy Gallagher, to represent the interests of small business and the finance sector on the draft Digital ID Bill.

For CAFBA members, a PSS will distinguish us as recognised professionals, creating a significant distinction between our businesses and non-CAFBA member businesses (such as the distinction between a bookkeeper and a CPA accountant). This distinction will attract more clients and a better calibre of staff, creating a higher value business model.

The Digital ID Bill looks to expand the use of Digital ID throughout the economy and move it to a nationally regulated system that includes strong privacy protections and is accessible to both the public and private sector. This means that individuals and businesses will be able to use Digital ID as verification across a range of services, removing the need for handing over sensitive personal documents.

George Karam Chair of Self-Regulation

5.3 Advocacy: CAFBA uses its influential policy voice to support brokers, small and mediumsized businesses and the Australian economy; CAFBA continued to pursue its advocacy work throughout 2023, using our influential policy voice to support brokers, small and medium-sized business, and the Australian economy. Important submissions were made to the government on the Australian Financial Complaints Authority's (AFCA) approach to small business lending and to the Attorney General's Department regarding Australia's money laundering and counter-terrorist financing (AML/CTF) requirements. We also made key submissions to the federal budget on the importance of retaining the Temporary Immediate Expensing (TIE) scheme and requesting the reinstatement of the Instant Asset Write Off (IAWO) scheme for eligible taxpayers on a limited basis.

David Gandolfo & Richard Marles (Deputy Prime Minister)

The move to a national digital ID system accessible to the private sector represents a significant economic and security opportunity for Australian business, commercial brokers included. Not only will a national Digital ID system increase efficiencies for brokers by eliminating the need for the transferal and storage of customers' identification information, but it will also significantly reduce the risk of data theft.

Recent cyber incidents have highlighted the need for a more secure way for Australians to verify their ID online. According to the Australian Institute of Criminology, online scams and identity crime has an estimated annual economic impact of more than $3.1 billion each year. An economy-wide Digital ID system offers significant economic benefits in the form of reduced costs and increased efficiencies.

David Gandolfo & Stephen Jones (Minister for Financial Services)

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liaise with political parties and regulators and communicate the needs of small business and commercial brokers continues to be an invaluable asset to commercial finance in Australia.

Jim Chalmers (Federal Treasurer) & David Gandolfo

The objectives of the Digital ID Bill are to promote and protect privacy and security of information, convenience in accessing services, and facilitate economic advancement through the use of Digital IDs. The Bill aims to achieve these objectives through strengthening the voluntary accreditation scheme for providers of Digital ID services, building on the existing Trusted Digital Identity Framework, and by providing legislative authority to expand the federal government's Digital ID System. The Bill will also establish an independent Australian Digital ID Regulator (initially to be the ACCC) responsible for accreditation, approving participation in the AGDIS and enforcing compliance with the non-privacy aspects of the legislation.

David Gandolfo & Bruce Billson (Australian Small Business & Family Enterprise Ombudsman)

Summary of Submissions to Government and Regulators Summary of Anti-Money Laundering and CounterTerrorist Financing (AML/CTF) Submission

CAFBA's Position & Recommendations Due to a lack of specific guidance, the way in which banks apply AML/CTF policy and procedures in order to achieve legislative compliance varies between banks and sometimes even within their own organisations/departments. As a result of this lack of consistency, it's becoming increasingly difficult for businesses, bankers and brokers (and accountants) to work out what is actually required by each financial institution. This confusion leads to long delays in opening accounts, applying for credit, finance settlements, undertaking annual loan reviews etc, which are clearly unintended consequences.

For the commercial broking industry, the legislation means a simpler way to verify customers identification information. Brokers will have access to a market of accredited Digital ID providers, offering both the broker and their client's peace of mind.

There has been extensive consultation on the Digital ID bill since 2021, with the current draft legislation reflecting views and opinions received through this consultation process. With the release of this latest draft legislation, another round of public consultation has begun. Once this round of consultation has concluded, the draft legislation will be introduced into Parliament.

CAFBA would like to recognise and thank our Chair of Advocacy, Patron and Life Member, David Gandolfo, and congratulate him on his deserved recognition at this year's Australia Day Honours, where he received an Order of Australia Medal for service to Australian small business. David's tireless work advocating for our industry, and his ability to

David Gandolfo & Ross McKewan (Group CEO & Managing Director of NAB

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urgently to meet the requirements of a particular project. Therefore, the expediency of the credit approval may outweigh the cost of capital. There are many factors that influence the choice of loan product.

CAFBA submitted that while AUSTRAC guidance is very principled, it should be more prescriptive, and an overhaul of the entire Act is required. The review of the Act should look at specific customer-level issues and focus on more prescriptive, sectional (i.e. asset finance) procedures and strongly recommended that AUSTRAC issue its own clearly defined AML/CTF form, which clearly sets out what is required, and accordingly makes clear what is not required, with the revised act recognising: 1. The relatively low risk of Asset Finance transactions, and exempt granular transactions under a proposed threshold of $300,000, indexed.

2. The flow of funds in Asset Finance transactions and place less emphasis on the Borrower and more practical emphasis on the goods supplier / receiver of funds.

Michael Rothe (President & CEO of the CANADA Finance & Lease Association), David Gill, Ralph Petta (CEO of the US Equipment Lease & Finance Association), David Gandolfo

Consideration also needs to be given to the size of the loan. Less information may be sought for a small ticket loan (eg laptop computer) than a higher cost item.

Summary of Australian Financial Complaints Authority (AFCA) Submission CAFBA's Position & Recommendations

Summary of 2023-2024 Federal Budget Submission

It is a condition of CAFBA membership that commercial equipment finance brokers must belong to AFCA. Our members are diligent in their assessment of borrower's requirements, but often can be targeted by complainants due to their AFCA membership where no other option is available and requested that AFCA recognizes that our members and many lenders are voluntary AFCA members.

There are many small business lenders who are not AFCA members and AFCA can only consider complaints against financial firms that are AFCA members. This has the effect of unfairly targeting AFCA members. If a CAFBA member introduces a transaction to a financial firm that is not an AFCA member, then often the complainant will make that complaint against the AFCA member even though no fault is attributed.

CAFBA's Position CAFBA stressed in our submission that the Temporary Immediate Expensing (TIE) and Instant Asset Write Off (IAWO) policies are distinct and require separate consideration in the Federal Budget. TIE, which was set to end in June this year, has been masking the fact that the IAWO actually ended on June 30 of 2022 and has been reduced to $1,000. As the two policies overlap, they are often regarded by accountants and industry participants as being the same policy.

CAFBA proposed that TIE should be extended beyond June 2023 for businesses that can demonstrate an existing order is in place as at Budget night 2023.

IAWO to be restored from June 2023 to coincide with the conclusion of Temporary Immediate Expensing. Assets below $100,000 to be expensed, saving administrative and accounting cost for both taxpayers and government.

AFCA's approach must be cognizant of this and understand the nuances of small business lending.

The requirements of the borrower need to be considered in any assessment, for example a contractor may require an item of equipment

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$3m, which are now obliged to keep personal information secure or notify customers of data breaches – which requires significant investment.

Instant Asset Write-Off (IAWO) to be extended for three years to give business certainty for future investment planning. Annual renewal for a further 12 months to be considered and announced at each subsequent Federal Budget to maintain the three year forward planning window.

One key aspect that would likely impact our industry is “The Right to Erasure”, with Government agreeing in principle that while not overriding laws requiring companies to retain identification documents, individuals can request the deletion of records when they are no longer legally required.

While we are still to understand the full implications of these proposed changes, it would appear that while Brokers can hold onto ID required to comply with certain legislative requirements (eg we assume this would include AML / CTF) , they might for example be required to remove other personal information by request of a client (eg Phone numbers, address etc) which would be challenging to fully comply with if information is held in various formats/systems. This may also conflict with contractual requirements between Lenders and Brokers to hold certain information for a set period of time.

David Gandolfo OAM CAFBA Advocacy Chair

Compliance Committee The Compliance Committee was formed to identify issues that affect the efficiency of the industry and the work of commercial brokers which can, in part be taken up by Advocacy to lobby both governments and regulators.

In addition to AML/CTF which has been discussed other issues included:

Cyber Security Following the high-profile examples of Australian cyber breaches such as Latitude and Optus, members were made aware that Australian Financial Services License (ASFL) holders have responsibility for the cyber security and cyber resilience of their authorised representatives (AR).

ASFL holders must have controls in place that are adequate to manage risk in respect of cyber security across their ARs.

Privacy Law Reforms This issue is now at an even higher priority for awareness following the Federal Government's announcement 29th August 2023 by the Attorney General of the most significant reshaping of the nation's Privacy regime in decades, following the Federal Government committing to 38 out of 116 proposals from the 313-page Privacy Act Review Report and agreeing in principle to 68 measures.

In the context of considering compliance of section 912A(1)(a) for the Corporations Act;

Key amongst those is the removal of Privacy exemptions for small business with turnovers under

Leaders Forum Luncheon at NSW Parliament House

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Annual Review 2023

An AFSL holder is required to identify the risks that the ARs face in the course of providing financial services pursuant to the licence, including in relation to cyber security and cyber resilience, An AFSL holder must have documentation, controls and risk management systems in place that are adequate to manage risk in respect of cyber security and cyber resilience across the AR network; and The relevant test is what the reasonable person qualified in the area of cyber security and cyber resilience would expect, not the expectations of the general public.

Neil Ferguson Chair of Compliance Committee

5.4 Member Value: CAFBA articulates a compelling value proposition that attracts current and new entrants to the profession to join the association.

Among the primary objectives of our strategic goal to

Unfair Contract Terms

increase member value is the effective monitoring of

Following the Federal Parliament passing additional legislation late last year (More Competition, Better Prices Bill) that extended the unfair contract terms – we highlighted the potential impact to our members.

market conditions for commercial finance to provide

For example, in relation to the credit products that members arrange on behalf of their clients, for most part any unfair contract terms within the credit contracts will be an issue between the client and the relevant lender. However, as the broker, and as part of the service brokers provide, it is important to be aware of any unfair or oblique terms in finance contracts. (eg potential for financiers to apply caveats to a guarantor's property etc).

PPS reform The Attorney General's department sought feedback to proposed legislative changes to the Personal Property Securities Act 2009. (Cth) (PPS Act).

CAFBA through its advocacy work has been engaged on this matter through its regular consultation with the Australian Financial Services Authority. Suggested changes included; • Financiers not releasing interests within 14 days, and historical fixed charges which remain on the register 10 years after the migration from ASIC • AFSA working on reducing the mandatory release period to five days • Transitioning to plain English from acronyms like PMSI and Allpap

members with greater information and insights. This monitoring includes the commercial property market, and this year, with NSW facing a number of legislative changes that will affect the sector nationwide, CAFBA organised its first ever Commercial Property Market Summit, with NSW Building Commissioner David Chandler.

Commissioner Chandler is leading Construct NSW's once-in-a-generation reform of the state's building and construction industry following a number of high-profile cases of poor quality developments. The Summit presented CAFBA members an opportunity to gain valuable insights into the proposed new regulatory framework, which includes increased compliance for financiers. It is an imperative that both brokers and lenders are aware of the legislative changes and what the new regulations mean for lending arrangements with developers.

The Building Commissioner placed a portion of the responsibility on cleaning up the state's building and construction sector on financiers and encourages financiers to establish a policy of active lending, that is, lenders taking a direct interest in the developments they finance, including site inspections and engagement with developers to ensure compliance requirements are met.

Another objective of our strategic goal to increase member value is the development of platforms that

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Annual Review 2023

advance a professional and innovative commercial finance industry, to provide our members with greater insights into all aspects of the industry.

Profit, to examine the core problem: the barriers that are standing between the current state of play and a truly diverse and inclusive work environment.

Last year saw the successful launch of CAFBA Collaborate. As a reminder, CAFBA Collaborate is an online platform exclusively for CAFBA members to connect, engage and share insights into the asset and commercial finance industry.

The Diversity & Inclusion Committee's research found overwhelming statistical evidence in support of the benefits of a diverse workforce. Diverse teams make better decisions, deliver better results, are more productive, provide better customer service and are 9 times more likely to innovate than teams which are lacking in diversity.

CAFBA Collaborate allows members to collaborate with fellow brokers to share strategic advice, solve challenges and discuss the industry. Features include: • Discussions - members have the ability to communicate and connect with fellow brokers/members on important topics; • Resource Sharing - all attachments posted to discussions are archived in a dedicated Resource Library. Members can also add documents to share anything they want; • Member Directory Search - Members can be found by name, location, company, or area of interest.

2023 saw an increased use of the platform resulting in a corresponding increase value the platform provides, with discussion groups expanding and the Resource Library continuing to grow.

Diversity and Inclusion CAFBA also made significant progress in the application of our Diversity and Inclusion Strategy, which was delivered in June of last year. The strategy sets a clear path for CAFBA to follow in order to advance equality, inclusion and diversity within the commercial and asset finance industry and help members leverage the resulting benefits to create more resilient businesses that can both endure and drive change.

Led by CAFBA Board Member Sharon Piening, the Strategy was developed with research by CAFBA's Diversity & Inclusion Committee into the barriers to and benefits of workplace diversity that went beyond existing thinking within the market. The Association commissioned Suzanne Mercier, CEO of Purpose to

17

The Strategy identifies six key areas to address, with recommended actions for the Association to take over the course of 2023 to reach targeted outcomes. These areas include: 1. Increasing the diversity of Australia's workforce to match the diversity within the population; 2. Ensuring that within diverse workplaces, organisations are getting the full benefits of that diversity.

3. Power sharing and inclusion; 4. Gender Equity, which is considered a lead indicator for creating a more diverse workforce, and is going backwards on key measures; 5. Leadership and ways to create a culture of inclusion; 6. Pathways into commercial and asset finance for a more diverse group of people.

Some of the areas the Committee have chosen to explore are sensitive, however, it is CAFBA's belief that it is important for us to hear the views and frustrations of members of diverse groups in the population, and to keep them in mind as we developed our recommended strategies.

Sharon Piening Chair of Diversity and Inclusion

Annual Review 2023

6. Commercial Finance Market Overview 6.1 Commercial Property Finance Year in review Beginning of the Year Interest Rate Cycle The start of 2023 was all about interest rates and the question on everyone's mind was, “when will they stop rising?”. We saw the RBA raise the cash rate in March, April, May, and June, followed by a four month pause and then another in November. The pause was sufficient to demonstrate that we are near the end of the curve and breathe a little bit of confidence back into the market.

The next few RBA meetings will indeed be of great interest and should set the tone for where we go early next year.

What effect did this have on capital markets?

Despite the various challenges of this year, the markets have remained relatively liquid. The first half of the year saw lenders playing conservatively; however, we noticed a distinct change in attitude once the interest rate pauses commenced around the middle of the year. Leverage was pushed back up, particularly for residential development, which most leading indicators suggest will be the asset class of choice over the next few years.

A strong residential apartment market The residential apartment market is still undersupplied and has proven the strongest market for 2023. This undersupply has been widely reported, which coupled with now pre-COVID migration levels, means the demand for housing has never been higher. To be able to deliver affordable housing remains a challenge, given historically high land values and the dislocation in the construction sector. This has affected developers' ability to deliver new stock, as well as purchasers' ability to afford new stock.

Residential affordability In the apartment market, over 80% of what we are funding would be considered owner-occupier, downsizer, or luxury apartment stock. This doesn't augur well for affordability in the short term, nor a solution for the ongoing rental squeeze. More government intervention seems to be required to solve the problem,

either through rezoning, relaxing planning laws, or incentivising mid-market developers to deliver affordable housing accommodation. Build-to-rent could be part of the solution here, however, we are yet to see many (any) active players in the mid-market space, as construction costs, coupled with low rental yields and holding costs make this space a “no go” for anything other than institutional balance sheets. As it is, delivery on these projects in the insto space has been very slow.

Construction challenges softening?

Dislocation in the construction industry continued throughout 2023. A number of household name construction firms went to the wall, along with many more unknown. Construction costs probably plateaued somewhere around the middle of the year but remain up anywhere between 30% and 50% since the start of COVID. We may see some softening in construction prices early next year as builders recalibrate their forward-looking workbooks and a slowdown in project starts sees labour shortages soften. It remains to be seen if this will play out; we're not holding our breath.

Commercial Property Yields Commercial investment assets are still undergoing an unwind, with a bit of “yield softening” to yet play out.

We expect this to play out slowly but surely over the next 12-18 months. Positively, there has been no “knee jerk” reaction from the market to date, with the banks continuing to be flexible with existing borrowers, despite Interest Cover Ratio (ICR) breaches. Acting precipitously isn't in the best interest of the banks, the real test will come at the end of term, when revaluations will likely reveal an LVR and ICR beach. For those in breach, banks will have their hands tied. Borrowers will be faced with the limited options: those who can't pay down debt or refinance to a non-bank alternative will be forced to sell assets and crystalise their loss. Non-bank lenders are beginning to adapt their product offering to meet the expected fall out of transactions from the banks.

Coupled with their ongoing appetite for construction debt, we expect the non-bank footprint to only increase over time.

Debt Capital Markets Survey At the beginning of this year, we surveyed over 100 lenders about the state of the debt capital markets and

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Annual Review 2023

their forecasts for the year. While there was still liquidity in the market, lenders indicated they were being far more selective. Over half of respondents expected major banks to decrease construction lending activity, given the construction landscape.

Despite the reduced appetite, 76% of respondents expected to grow their loan books this year, suggesting a focus on quality deals with strong sponsors.

• We've seen banks increase their appetite for residential construction deals in the last quarter after a period of uncertainty. They're altering their traditional policies of 100% debt cover and seeing transactions settle at as low as 60%.

Investment/Occupier Funding:

• Borrowing confidence has risen due to more stable borrowing costs. After the rate hike in November, the first RBA meeting of ‘24 will likely set the tone for the year.

The Debt Capital Markets Survey also revealed lender appetite for asset classes, with residential markets at the top, while industrial remained strong but at its peak and commercial office a concern due to increasing vacancy rates and leasing incentives. These preferences have carried out throughout the year.

• Banks still slightly wary but remain open to good quality assets and sponsors.

• Many non-bank options available at increased leverages and with less conditionality to banks.

Interestingly, most respondents believed the cash rate would top out at 4.10% with only 10% of respondents believing we'd see the cash rate as high as 4.25%.

Majority of respondents believed that we wouldn't see the cash rate begin to come down until 2024.

Jeremy Wilson Head of Structuring & Transactions Stamford Capital Australia

Wrap up:

6.2 Commercial Equipment Finance

This year we've seen a gamut of challenges thrown in front of commercial property: continued rising interest rates and disruption in the construction industry, geopolitical tensions, and global and local economic downturns.

The commercial equipment finance market has shown positive signs during 2022/23. Each year CAFBA receives data from the Australian Finance Industry Association (AFIA), who reported strong growth in a number of equipment finance sectors.

It certainly hasn't been easy for developers and investors. Transaction settlements are taking longer and borrowing costs are higher, negatively impacting investor and developer IRR's and investors' cash on cash yields.

In the Reserve Bank of Australia's (RBA) Statement on Monetary Policy (November 2023) non-mining business investment has grown strongly, reflecting resilient business conditions and an unwinding of supply chain disruptions.

Those with access to the complete lender market, capital has always been available for good sponsors and in-demand, well planned assets in prime locations.

The RBA reported that business investment has increased strongly over the past year, with broadbased growth across non-mining industries (Graph 2.13). Growth in non-mining business investment over the first half of 2023 was the strongest outcome since 2007, aside from the pandemic rebound. Investment in machinery and equipment as a share of GDP has risen to its highest level in a decade, partly reflecting the boost to vehicle sales from an unwinding of supply chain disruptions. Non-residential construction has also increased strongly; very low vacancy rates and a large increase in rents for industrial property have led to a strong pick-up in industrial building activity.

Development Funding:

• Lender appetite to leverage has increased. We are regularly executing deals at 75% LVR (90% of cost), particularly in the residential development space or for good de-risked commercial projects.

• No presale options available, depending on location, price point.

• Construction costs seem to be stabilising, giving lenders comfort to lend higher leverage and with less conditionality.

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Annual Review 2023

Graph 2.13

In FY22 there was strong growth in a number of sectors of Equipment Finance, with the total market result weighed down by the fall in Cars & Light Commercial vehicles.

Survey measures suggest that business investment will continue to grow, underpinned by strong population growth, a high level of capacity utilisation and measures of business conditions that remain around average levels. Increased investment should, over time, help to lift labour productivity. A large pipeline of building and engineering work should support nonresidential construction over the coming years, although the timing of work is uncertain given ongoing labour constraints. The ABS Capital Expenditure Survey showed that, in aggregate, nonmining firms have revised up their expectations for investment for the 2023/24 financial year and nominal investment intentions are a little above 2022/23 levels (Graph 2.14). Investment intentions reported by firms

In FY23 three Equipment Finance Sectors saw a strong growth, while declines in Mining, Manufacturing and EDP/ Office Machines tempered the total market result.

General Equipment Finance by Equipment Type Share of Receivables end June 2023 - 82.9bn

in the Bank's liaison program remain above their longrun average.

Graph 2.14

General Equipment Finance by State Receivables end June 2023 - 82.9bn

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Annual Review 2023

Equipment Finance Industry Aggregates Volume ($bn) 2021/22 2022/23 General Equipment Finance $36.6 $38.9 Fleet leasing $7.3 $7.6 Total Equipment Finance $43.9 $46.5

General Equipment Finance

Receivables ($bn) 2021/22 2022/23 $84.3 $82.9

Data sourced from Australian Finance Industry Association (AFIA)

7. CAFBA Membership

8. Women of CAFBA

CAFBA continues to grow as those who practice commercial finance broking understand the importance in belonging to an Association that specialises in their activities. With the work being undertaken to make application to the Professional Standards Scheme gaining traction, there is a desire for those that practice in commercial finance to be part of a profession and be recognised as professionals. It is this recognition that has contributed to CAFBA's growth over the past 12 months.

The Women of CAFBA Forum has been established for over 5 years and we are going from strength to strength.

The Forum's purpose is to encourage women in the industry to network and support each other. We hold three events annually in each of New South Wales, Victoria, QLD, South Australia, and Western Australia.

We welcome females from across our whole industry, brokers, support staff and lenders. These events are aimed to showcase the diverse career pathways in the Commercial and Asset Finance sector, and to encourage and inspire women to take the next step in their career if they so desire. They also provide a safe and receptive environment to discuss tricky transactions and business ideas.

During 2022-2023 CAFBA membership grew by the following:

Full members (broking firms)

17%

Associate members (individual brokers)

13%

Affiliate members

12%

This growth in part supports CAFBA's strategic direction of professionalism and education as being integral to better customer outcomes.

Our most successful event to date was the 2023 International Women's Day event which was attended by over 300 CAFBA members nationally, both male and female. It was interesting to hear some of our male members say they were nervous about walking into a women's event. The experience highlights the everyday challenges women face when attending industry events. We heard from successful female brokers and finance professionals who shared their stories and what they have done to advance in the finance industry.

Our team is continuing to listen to our members and attendee's and recently held a strategy meeting to find out what female brokers want from the Women of CAFBA Forum. A lively discussion with many different

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Annual Review 2023

points of view but what did stand out is that we really want to support each other and offer support to others.

• COG

We will be rolling out some of these suggestions over the next couple of months.

This year the recipients were:

• Connective • Flexicommercial

• Lauren Murray - Advanced Leadership • Alice Khol - Leading Edge • Mabel Chen - Leading Edge

Sharon Piening Head of Women of CAFBA

• Michelle Hadgkiss - Leading Edge • Alyssa Baird - Leading Edge

9. Leadership Scholarship Program

Lauren Murray

9.1 Women & Leadership Australia This year CAFBA was pleased to announce that nominations were open for those interested in participating in one of Women & Leadership Australia's (WLA's) leadership development programs and to apply for a fee support scholarship available for women working in the commercial and equipment finance sector.

Mabel Chen

For the past eight years, CAFBA have partnered with Women & Leadership Australia to address gender imbalance in the commercial and equipment finance industry by supporting more women to build their leadership capability through world-class leadership development programs.

Alyssa Baird It was a phenomenal course, I am still utilising skills I learnt as part of the course today, and it has been valuable to pass on insights I obtained to my female brokers and colleagues.

67 scholarships have been provided so far to CAFBA women through this partnership to undertake one of Women & Leadership Australia's flagship leadership development programs, and graduates have found their experience to be enriching and beneficial, both personally and professionally.

9.2 Inclusive Leadership Program Whilst providing scholarships for women over the years to address gender imbalance, CAFBA has always been conscious that we need to facilitate leadership opportunities across our wider community.

The programs support women to unlock their leadership potential, build confidence, reflect, and open up networking opportunities to learn from women across finance and other industries.

Therefore, this year we trialed the Inclusive Leadership Immersion program run by Suzanne Mercier of Purpose to Profit. The course taught the benefits of addressing inclusion as a business case for success, which is driven through leadership. These benefits included:

The scholarships cover part of the cost of the course, however as in the past CAFBA relied on sponsors to assist with the balance of the program fees.

We would particularly like to thank and acknowledge the generous support of

• significantly enhanced leadership capability • increased employee engagement

• ANZ

• greater innovation and creativity

• BOQ

• improved decision-making and risk management

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Annual Review 2023

• enhanced team performance • enhanced customer service • expanded networks and partnerships CAFBA provided two scholarships for the program as well as having other interested members undertake the course. Congratulations to the following participants:

• Matthew Atkin • Amanda Ceasar

We are fortunate to have received sponsorship support from Metro, Flexicommercial and Resimac Asset Finance during the year, and greatly appreciate their support. It is with support from industry partners like this that we can continue to put on amazing events.

The feedback of our events is always so great, and we are looking forward to what we can achieve and do for the young people in our industry in 2024!

• Caroline Grima • Craig Hill • Alice Khol • Jane Lorimer

Max McFarlane

• Steve Martin • Joel Mantin • Craig Ruthven • Leanne Walsh • Sarah Whittle CAFBA will continue to offer courses to expand leadership qualities across a range of members

10. Commercial Lending Young Professionals (CLYP)

In 2023 CLYP continued to put on great events for the young cohort of our amazing industry. Across Sydney, Melbourne, and Brisbane we had hundreds of people attend our events.

CLYP is working on growing and doing even more for the young CAFBA members and people in our industry, including focusing on different types of events, bringing in more education and interesting speakers and increasing industry engagement.

We held a strategy workshop again this year to review the goals and vision of CLYP that were set last year, and we are pleased to say that we are tracking well on the goals and continue to create value for CAFBA's young members and others in the industry. A lot of work goes on behind the scenes by the CLYP committee who volunteer their time, and we are lucky to have such passionate, smart, and dedicated people involved.

11. Awards CAFBA held our Annual Broker and Financier Awards Gala in September for the first time in Sydney, and it was another night of great fun celebrating the best of our industry. With nearly 400 in attendance, the Awards night has become one of the most important events on the commercial broking calendar and represents the only opportunity for brokers, lenders, and aggregators to come together under one roof.

This year's Awards marked a change in the method we use to formulate the Award nominations and voting for the Broker awards, moving away from a self-nominating system by asking a range of CAFBA affiliate members to nominate their best brokers based on a predetermined criteria that did not include volume. Our criteria were based on values which align with CAFBA's strategy, and the questions included quality of submissions, book quality, firm diversity, education pathways and standards and best customer outcomes. The change in methodology was a tremendous success.

Congratulations to all the winners, who are listed below.

Emerging Broker of the Year Winner

Andy Chisholm

Finlease (Aust) P/L

Samuel Hamilton FINAPPS Pty Ltd Thomas Franklin

23

Linx Finance Aust P/L

Annual Review 2023

Credit Team of the Year

Broker of the Year Winner

Donella Cutts

Allfreight Finance

Metro Finance

Milena Franjic

QPF Finance Group

Bank of Queensland

Winner

Metro Finance

Truss Finance Australia Pty Ltd

Westpac

Machine Equipment Finance

FlexiCommercial FinTech of the Year Winner

QPF Finance Group

Shift

Quantum Business Finance Pty Ltd

Grow Finance

Finlease (Australia) Pty Ltd

Angle Finance

Broker Firm of the Year (less than 5 business writers) Winner

Settlements Team of the Year

Podium Equipment Finance

Broker Firm of the Year (more than 5 business writers) Winner

FlexiCommercial

Linx Finance Aust P/L

Emerging Broker Firm of the Year Winner

Winner

Nittin Gopaul

Aggregator of the Year Winner

Phillips Basile Equipment Finance

COG Aggregation

Capital Plus Finance

College Capital Australia Ltd

Hamer Finance Pty Ltd

Connective

Women in Leadership Winner

Lauren Murray

Brisbane Finance Group

Alyssa Baird Alice Kol

Connective Talk to a Broker

At the Awards night CAFBA also pays recognition to those that have made a significant contribution to the industry. This year we were pleased to make two awards in these categories for excellent service.

College Capital

Service to the Industry

Women in Finance Excellence Winner

Leanne Walsh

Contribution to CAFBA

11.1 Financier of the Year For the Financier Awards CAFBA surveys members annually to ascertain the CAFBA Financier of the Year. All the major Australian financiers are Affiliate Members of CAFBA, who provide an important service to the broker community. CAFBA recognises this contribution and works closely with the financiers for the benefit of the commercial and equipment finance industry.

The Financier of the Year award is keenly sought by the commercial finance lenders. The voting categories of these awards have remained the same since their inception. Congratulations to Westpac who again have won the Financier of the Year.

Financier of the Year Winner

Westpac FlexiCommercial Metro Finance

Noel Smith

Mike Steel

11.2 BDM of the Year CAFBA also awards a Business Development Manager (BDM) of the Year in each State, to acknowledge the work and service that the BDM's of the Lenders provide to the commercial brokers. Over time we believe this award will become just as prestigious and as keenly sought as the Financier of the Year.

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Annual Review 2023

Queensland Winner

Alan Comer

Westpac

Jodie Picton

Capital Finance

Mykolas Kaliacius

FlexiCommercial

New South Wales Winner

Patrick Netrayana FlexiCommercial Jamie Mercer

NAB

Steve Dilworth

Westpac

Bree Wrigley

BOQ

Chris Vogias

Capital Finance

Craig Fraser

Metro Finance

Victoria Winner

Western Australia Winner

Jenny Whelan

Westpac

Kylee Heys

BOQ

Nicole Hitch

Pepper

South Australia Winner

Hayden Lever

Westpac

Hai Pham

Resimac

Mark Kerin

Commonwealth Bank

Tasmania Winner

David Johns

Westpac

Claire Micari

FlexiCommercial

Craig Fraser

Metro Finance

Congratulations to all those nominated and the winners and thanks to our major sponsors who make these nights possible: Platinum: Commonwealth Bank Gold: BOQ Finance, FlexiCommercial, Metro Finance, Westpac

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Annual Review 2023

Awards

Broker of the Year Nittin Gopaul

WA BDM of the YEAR Jenny Whelan

QLD BDM of the Year Nicholas Gleeson

Emerging Broker of the Year Andy Chisholm

VIC BDM of the Year Bree Wrigley

Women in Finance Excellence Award Leanne Walsh

Women in Leadership Presenter Dr Janet Smith accepted by Sharon Piening on behalf of winner Lauren Murray

NSW BDM of the Year Patric Netrayana

SA BDM of the Year Hayden Lever

TAS BDM of the Year David Johns

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Annual Review 2023

Awards

Aggregator of the Year - COG Aggregation

Settlements Team of the Year - Metro Finance

Financier of the Year - Westpac

Broker Firm of the Year (Less than 5 Business Writers) PhillipsBasile Equipment Finance

Broker Firm of the Year (More than 5 Business Writers) QPF Finance Group

Fintech of the Year - Shift

Contribution to CAFBA Award Mike Steel

Credit Team of the Year - FlexiCommercial

27

Emerging Broker Firm of the Year Podium Equipment Finance

Annual Review 2023

NSW Golf Day

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Annual Review 2023

Treasurer’s Report On behalf of the board, I am pleased to be able to share the financial statements for the year ending 30 June 2023. These financial statements have been audited by DKF who have provided an unqualified opinion.

All members would have received a copy of the financials and they have been published on our website.

As noted within the accounts our association reported a net loss after tax of $59,701.

This is a significant improvement on FY22 principally as a result of an increase in income from memberships and sponsorship. We are close to 1,500 members and we continue to grow our membership base. Our expenses have increased from 2022 as we continue to implement our strategic plan.

Whilst the cash reserves held by CAFBA remain at a high level the Board acknowledges that our organisation needs to be mindful of where our funds are invested, which may mean that we have to prioritise some of our strategic initiatives over others.

I confirm that our Association is in a sound financial position and ready to embark on the work that needs to be done such that CAFBA continues to be the “go to” professional body for commercial and asset finance brokers in Australia and, in particular, the work that the CEO and his team will complete in terms of CAFBA getting PS S accreditation which will further professionalise our industry.

I would like to thank our Affiliate Members, Full Members and Associate members for their support in addition to the continued support that we receive from all our sponsors.

Bruce Debenham

Our forecast for FY24 is based on increased activity and income in respect of membership and education and also incorporates sufficient funding for the Board and the CEO and his senior management team to put together our strategy for CAFBAs journey over the next 3 years.

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Annual Review 2023

Statement of Profit or Loss and Other Comprehensive Income for the Financial Year ended 30th June 2023 2023 $

2022 $

Revenue from Ordinary Activities

1,548,579

952,838

Award and Conference Expenses Advocacy Professional Standards Scheme CLYP Compliance Consultancy Fees Donations Diversity and Inclusion Expense Women of CAFBA Expense Golf Day Expense Xmas Cocktail Expense Professional Development Professional Fees Wages Superannuation Expense Travel, Accommodation & Meals Education Council Funding Subscription Fees Administration Expenses Sundry

(240,392)

(110,101)

(86,841)

(92,776)

(11,033)

-

(3,114)

-

(124,240)

(44,000)

(244,504)

(243,440

(4,500)

-

(24,866)

(1,615)

(37,889)

(36,061)

(68,920)

(27,613)

-

-

(47,341)

(21,289)

(156,637)

(204,386)

(213,974)

(126,306)

(21,525)

(11,900)

(151,790)

(64,870)

(14,492)

(68,570)

(60,057)

(72,882)

(54,773)

(61,313)

(14,195)

(17,891)

(1,608,280)

(1,220,169)

(59,701)

(267,331)

-

11,109

Operating Profit/(Loss) after Income Tax

(59,701)

(256,222)

Total Comprehensive Income

(59,701)

(256,222)

NOTE

Total Expenses from Ordinary Activities Surplus before Income Tax Income Tax attributable to Operating Profit/(Loss)

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Annual Review 2023

Statement of Changes in Equity for the Financial Year ended 30th June 2023 Retained Surplus $

Total $

Equity Retained Surplus Balance at 1 July 2021 Surplus/(Deficit) for the year

506,680

506,680

(256,222)

(256,222)

Balance at 30 June 2022

250,458

250,458

Balance at 1 July 2022 Surplus/(Deficit) for the year

(59,701)

(59,701)

Balance at 30 June 2023

190,757

190,757

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Annual Review 2023

Statement of Cash Flows for the Financial Year ended 30th June 2023

NOTE

2023 $

2022 $

1,581,757

882,892

727

147

Cash Flows from Operating Activities Receipts from Members and Others Interest Received Income Tax Paid Payments to Suppliers and employees

9,325

(38,647)

(1,283,767)

(1,137,151)

Cash Flows from Operating Activities

308,042

(292,759)

Cash Flows from Financing Activities

–

–

Cash Flows from Investing Activities

–

–

Net Cash Inflows/(Outflows)

308,042

(292,759)

Opening Cash on Hand Net Cash Inflows/(Outflows)

683,275

976,034

308,042

(292,759)

Cash at end of Financial Year

991,317

683,275

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Annual Review 2023

CAFBA Honour Board PAST PRESIDENTS

Contribution to CAFBA Award

2008/09

David Gandolfo

2014

Glenda Boschert

2009/10

David Gandolfo

2018

Daryl Raggatt

2010/11

Mark Rayson

2019

Mark Caddy

2011/12

Mark Rayson

2019

Greg Moylan

2012/13

Terry Moody

2022

Graeme Latta

2013/14

Terry Moody

2023

Mike Steel

2014/15

Terry Moody

2015/16

David Gandolfo

CAFBA Financier of the Year AAFA/CAFBA Award Winners

2016/17

David Gandolfo

1999

CBFC

2017/18

David Gandolfo

2000

CBFC

2018/19

David Gandolfo

2001

Suncorp Metway

2019/20

David Gandolfo

2002

Westpac Equipment Finance

2020/21

Matthew Atkin

2003

Westpac Equipment Finance

2021/22

Matthew Atkin

2004

Macquarie Leasing

2022/23

Matthew Atkin

2005

Capital Finance Australia

2006

BOQ Equipment Finance

2007

BOQ Equipment Finance

2008

Westpac Equipment Finance

2009

BOQ Equipment Finance

2010

Macquarie Leasing

2011

Macquarie Leasing

2012

Capital Finance Australia

2013

Macquarie Leasing

2014

Westpac Equipment Finance

SERVICE TO THE INDUSTRY AWARD

2015

Westpac Equipment Finance

2014

Geoff Wallace

2016

Westpac Equipment Finance

2016

Joe Terlato

2017

Westpac Equipment Finance

2017

Ron Hardaker

2018

Capital Finance

2017

John Bills

2019

Westpac Equipment Finance

2019

Barry Clarke

2020

Westpac Equipment Finance

2020

Phil Botsis

2021

Westpac Equipment Finance

2022

Peter Strong

2022

Metro Finance

2022

Michael Felton

2023

Westpac Equipment Finance

2023

Noel Smith

CAFBA CEO’s 2012 to 2023

David Gill

2023 - Current David Bushby LIFE MEMBERS 2013

Terry Moody

2013

David Gandolfo

2013

Kathryn Bordonaro

2022

Ian Elkner

33

Annual Review 2023

Commercial & Asset Finance Brokers Association of Australia

CONTACT DETAILS Registered Office: Suite 5.02, 655 Pacific Highway, St Leonards NSW 2065 Mail Address: PO Box 576 Crows Nest NSW 1585 Auditor: DFK BKM Audit Services 689 Burke Road, Camberwell VIC 3124 Legal Counsel: Steve Edwards - CreditWise Pty Ltd ABN 55 097 768 799 14 Haigh Place Castle Hill NSW Australia 2154 Telephone: 02 9885 7097 Follow us on Twitter @CAFBA1

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