AFG upgrades its profit forecast by 45%

The share market has responded as Australia's largest mortgage broker bumps up its profit forecast by almost 45 per cent.

Australian Finance Group shares have leapt after the company said it expects its profit for the current financial year to come in nearly 45 per cent higher than its earlier forecast, at between $37 million and $37.8 million.

The nation's biggest mortgage broker on Monday said it now expects its net profit after tax to be considerably higher than the previous guidance of around $25.5 million, due to an accounting change meaning it will recognise future trail commission revenue from the white label mortgages it supplies to brokers.

AFG shares were 13 cents, or 10.8 per cent, higher at $1.33 at 1306 AEST.