Vow Voice 10th August 2017

As the lending market becomes ever more complex, Vow Financial is focused on providing the best products for your clients. Vow Goup Lending is at the heart of this offering, which is why we are pleased to announce that a true home loan expert is joining our team.

Michael Chadwick started in the role of Head of Group Lending this week. He has over 25 years industry experience in Financial Services with most of his time spent working in the mortgage broking and lending space.

Michael's breadth of knowledge and experience in mortgages extends from Sales and Sales Management through to managing Operation teams as well as stakeholder management with panel lenders & partners.

Having worked for companies such as RAMS, St George Bank and Aussie, Michael's experience will be invaluable in helping our business grow.

Michael is excited to be joining Vow as Head of Group Lending where he will be responsible for the management and performance of our white label products through the group.

Michael has three teenage children, a personal interest in property investment, and enjoys his time riding motorbikes and is planning on his next trip overseas to attend the Isle of Man TT race in May 2018.

Figures from the Reserve Bank, released this week, show the average interest rates on both three-month and six-month term deposits have dropped below 2 per cent for the first time in recent months, the lowest level since the figures began in 1982. Against this background, Smarter Money Investments continues to provide a great option for your clients who are frustrated with low bank returns.

SMI funds are made up of an actively managed portfolio of bonds & cash deposits (mostly issued by banks), with a low risk profile and a higher return than term deposits or bank accounts. The latest performance figures show why SMI is so popular.

Smarter Money Active Cash Performance

The Smarter Money Active Cash (SMAC) strategy returned 0.26% in July after fees (0.33% gross) bringing the total 12 month return to 3.44% after all fees.

Smarter Money Higher Income Performance

The Smarter Money Higher Income (SMHI) strategy returned 0.31% in July after fees (0.39% gross) bringing the 12 month return to 4.24% after all fees.

Educational Videos

You can watch Co-Chief Investment Officer, Christopher Joye, speak on a range of topics including recent market developments and investing in fixed-income, via a series of short video interviews by clicking on the links below:

• An introduction to Smarter Money Investments
• Our investment approach
• Recent market developments
• Investing in fixed-income

For more information please contact:

Luke Bouris

Business Development Manager

M 0414 549 400

luke.bouris@smitrust.com.au

Cosimo Vallelonga

Investment Specialist

M 0402 895 072

Cosimo.Vallelonga@smitrust.com.au

Disclaimer: This information has been prepared by Smarter Money Investments Pty Limited ACN 153 555 867. It is general information only and is not intended to provide you with financial advice. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information. The Product Disclosure Statement (PDS) for the Fund should be considered before deciding whether to acquire or hold units in it and can be obtained at ybr.com.au/savings. None of the Responsible Entity, the investment manager, Yellow Brick Road Holdings Limited ACN 119 436 083 nor any of their respective shareholders, directors and associated businesses assume any liability to investors in connection with investment in the fund, or guarantees the performance of any obligations to investors, the performance of the Fund or any particular rate of return. The repayment of capital is not guaranteed. The fund is subject to investment risks, which could include delays in repayment, and loss of income and capital invested. To learn more about these risks, please read the fund's PDS and consult an independent financial adviser.

As you will know from experience, lenders have been tightening their standards when it comes to calculating living expenses.

While the Household Expenditure Measure (HEM) provides a framework, it's not a solution in and of itself.

Firstly, if the bulk of your applications track closely to HEM, it will raise a red flag with lenders. Living expenses must be calculated for the individuals and reflect their actual spending, not just a benchmark.

Did you know:

• ASIC is talking to funders to obtain lists of brokers who understate living expenses i.e. under HEM.
• Funders are interviewing brokers who regularly submit under HEM.
• Vow and YBR are contacting brokers with low living expenses and requiring the fact find, notes and backup to the figures that have been declared.
• Funders service at HEM anyway so brokers are making themselves a target for no reason.

This is one of the areas covered in the Vow Compliance Workshops. If you'd like to attend the next one, speak to your State Manager.

We are proud to announce that two of our Vow Broker Partners have been announced as finalists in the Women in Finance Awards, for Mortgage and Finance Broker of the Year:

Tamara Virgo, TV Financial Services and Planning

Sarah Wells, Sarah Wells - Tailored Banking and Finance Solutions

Clive Kirkpatrick, Vow Financial General Manager, said, "Congratulations to these talented finance professionals. Both Tamara and Sarah have shown a huge commitment to helping their clients, and are making a real difference to the industry. We wish them luck on the night."