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While there are unique businesses opportunities at both the large and boutique end of the size spectrum, Ballast GM Frank Paratore has said mid-tier mortgage businesses will struggle to survive.
His comments follow the Smartline/ The Mortgage Gallery merge, where Smartline claimed it to be a "validation of the importance of having scale in the mortgage industry."
Without scale, Smartline claimed it would be hard for smaller businesses to survive.
But, speaking to the MortgageMix, Paratore said he didn't necessarily agree.
"There is only so far businesses can grow before economies of scale are no longer as relevant as they were to get the business to that point," he added.
"For any given size, there is an optimal operating level. Too big can also be detrimental and fatal," Paratore said.
Instead, he said being boutique enabled operators to act as swiftly as required.
"It cuts the red tape, and provides a greater focus on personalized service."
Paratore also said that being independent allowed for 'total control' as well as greater flexibility of the business operations.
Smartline merge: Another in the pipeline? - As the news breaks that Smartline and WA based The Mortgage Gallery are to join forces from 1 April, Joe Sirianni has said that Smartline 'absolutely' has additional acquisition plans.
Ballast: Few boundaries between broking and financial planning - Ballast general manager Frank Paratore has said that there are as many mortgage brokers diversifying into financial planners as there are financial planners moving into broking.
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