Kim Cannon’s secret of success: home loans and rugby league a win for Firstmac

The founder of one of Australia’s biggest non-bank lenders measures his NRL sponsorship’s return on investment this way: mum and dad mortgage holders have now heard of his business.

Brisbane Broncos sponsor Kim Cannon believes team will win Sunday’s NRL Grand Final.

Billionaire Kim Cannon moved almost as swiftly as Brisbane Broncos superstar Reece Walsh to clinch what has turned out to be the best sponsorship deal of his business career just over a decade ago.

The Broncos struck trouble only three days before the start of the 2012 NRL season when its shirtsleeve sponsor Wow Sight and Sound went into receivership.

Cannon, founder and owner of what is now one of Australia’s biggest non-bank mortgage lenders, Firstmac, quickly made a phone call to Broncos management and signed up to take over the deal.

He has been reaping the rewards of backing rugby league’s most popular club ever since, and is confident the team has enough talent and determination to beat favourites Penrith in Sunday evening’s NRL Grand Final.

Cannon, 67, also has his own unique way of measuring the return on his sponsor investment.

“People say to me ‘how do you justify (the deal)?’ and I know the Broncos sit down with us at the end of each season with a fancy slide show presentation and pictures of this and that. And I’ll just say ‘yep, whatever’,” he tells The Weekend Australian.

“What has really helped is that once we did the sponsorship we didn’t have to explain in three paragraphs what a non-bank lender was. It just made it easier. Mum and Dad would sit down with a (mortgage) broker and they’d say Firstmac is a major sponsor of the Broncos and they’d get it. It adds some validation for us.”

The Broncos’ Reece Walsh who lines up on Sunday in the NRL Grand Final against Penrith. Picture: Adam Head

Firstmac now services almost 60,000 customers across the country and manages a loan portfolio of about $16bn. Cannon launched what was originally Lease National Finance, an equipment finance firm, in 1979, and last year Firstmac’s pre-tax annual profit reached $100m.

Cannon says one of the hardest factors in attracting new customers was “mum and dad being super-conservative when it came to getting a home loan or refinancing” during discussions with their broker.

They would inevitably, Cannon says, get told about three different loans, “one from someone like Commonwealth Bank, another from Westpac and a third from this non-bank lender called Firstmac. They’d talk about loan securitisation and what we do, and then, even if our loan was better, they’d stick to a big bank they already knew”.

The Broncos deal, he says, has changed that.

Cannon and Firstmac last year clinched an extension on their sponsorship contract for another five years through to 2027, which now includes the club’s NRLW female team, which carries Firstmac’s loans.com.au brand established and run by Cannon’s daughter Marie Mortimer (it has a $6bn book of home and car loans), and Broncos charity programs.

The Firstmac founder has been in Sydney since Wednesday, attending the Dally M medal presentation night with Broncos legend Allan “Alfie” Langer, and admits to some nerves ahead of Sunday’s big match.

“I’ll be on the edge of my seat watching. It has been an interesting finals series. I’d rather play Penrith than the Melbourne Storm, though. We seem to beat Penrith, even in our worst times. So I think we can match them.”

Ironically, Cannon was born in western Sydney and grew up in Blacktown – which he jokes is dangerously close to Penrith territory. He was a fan of St George before “escaping” to Queensland in the 1970s.

Cannon admits he lost touch somewhat with rugby league as he started building his business, but fell back in love with the sport in 1980 at one of the most famous matches in Queensland history.

FirstMac founder Kim Cannon at his office in 1979.

“We had an office 200m from (the old Lang Park) and so when the first State of Origin was played, I strolled down the street, bought a ticket and watched it on the hill. I’d moved to Queensland as it was the land of opportunity when Sir Joh (Bjelke-Petersen) was running the show, and I thought how good is this. And when the Broncos came along (in 1988) I ran with it.”

There have been plenty of good times for the Broncos since its inception, including six grand final wins, but recent years have been tougher.

Cannon remembers when the club reached rock bottom in 2020 when it finished last to “win” the wooden spoon. It was an embarrassment for such a big club and matters off the field were not helping. So Cannon did something about it.

“I remember going to a game, sitting there and there’s all this rubbish going back and forth. Ex-players were snipping and it wasn’t pretty. The Broncos lost on the bell (the final siren) and there were blokes who had played their hearts out crying on the ground. I walked away, thinking I was sick of it,” he says.

“So the next game I bought 50 tickets from the Broncos and said here’s a bar tab, get all the ex-players to come along and support the young blokes. My thought was to reunite the players with the ex-players. Slowly but surely the nonsense went away.”

The Broncos may be listed on the ASX (it has market capitalisation of about $100m and is majority-owned by News Corp, the publisher of The Australian) but Cannon says improved on-field fortunes have coincided with cultural change off it.

“Management realised it’s not just a business. You have to have family values, and I think they’d lost that a bit.

“I hate the public company arena, and I just try to be open with everything that we do. It is a family business, and I say we are a business family. The Broncos had become a bit over-corporatised and they’ve realised that brought back some family values and look what has happened.”

While Cannon says “we are seeing something special” with star fullback Walsh, he also pays tribute to the calming influence of veteran five-eight Adam Reynolds, recruited from South Sydney last year, and a former Penrith player in second-rower Kurt Capewell, who Cannon has helped influence his younger Broncos teammates by “showing them what it takes to play at the top level”.

As for Firstmac, Cannon claims it is “really thriving now” after volumes fell by about 30 per cent compared with Covid lockdown times when it was settling as much as $600m in loans per week around Australia.

“The major banks were out offering cashback offers to a lot of customers, so you had a situation where people were refinancing and taking the case, and then making repayments with the cash. The majors were benefiting from the (Reserve Bank’s) TFF (Term Funding Facility) during Covid and there was no point sitting there competing with that.

“We have stuck with the prime lending side of things, while a lot of our competitors got into near prime or nonconforming market. We try not to take risks. We’ve been around a long time and want to keep it going.”

Cannon admits he’s had plenty of offers to acquire his business over the years though, but has a simple answer.

“It’s a good business, so why do anything else?”