Digital Finance Analytics (DFA) Blog
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In a statement issued today, Treasurer Scott Morrison said the reform will represent the “most significant increases in maximum civil penalties in twenty years”. These increases are right, as before the financial impact of poor behaviour was very low However, do not be misled, changing penalties will not address the fundamental cultural, structural and economic … Continue reading “ASIC Penalties To Be Increased”
From The Adviser. The Reserve Bank of Australia has revealed that it believes all brokers should be required to act in a consumer’s “best interests”. In its response to the Productivity Commission’s draft report into competition in the Australian financial system, the RBA came out in support of several of the commission’s draft recommendations. Notably, … Continue reading “RBA supports best interests duty for brokers”
From The Adviser. A loan comparison tool proposed by the Productivity Commission could compete with the broker channel, according to six of Australia’s largest non-major banks. In a joint submission to the Productivity Commission (PC), AMP, the Bank of Queensland, Suncorp, Bendigo Bank, MyState and ME Bank warned that an online loan comparison tool could … Continue reading “Would A Loan Comparison Tool Compete With Brokers?”
From Otiena Ellwand at MPA. During the royal commission’s last two weeks of public hearings into the consumer and home lending space, the banks have regularly pointed the finger at mortgage brokers over such things as trail commissions leading to poor consumer outcomes and poorly verified expenses in customers’ loan applications. Not only did this … Continue reading “Royal commission: Banks bashed, brokers blamed”
NAB, the owner of three of the larger mortgage aggregators, says Broker-originated loans are refinanced at “more than double” the rate of direct-channel loans in its new submission to the Productivity Commission; reports The Adviser. In its second submission to the Productivity Commission (PC), released on Wednesday (21 March), the National Australia Bank (NAB) stated … Continue reading “‘No evidence’ that brokers limit switching: NAB”
From The Adviser. Applying best interest obligations to brokers could help preserve the integrity of the third-party channel, according to ANZ CEO Shayne Elliott. In his opening address to the Productivity Commission (PC) on Tuesday, 6 March, Mr Elliott claimed that a “best interest duty” applied to the broking space could enhance consumer protection. “About … Continue reading “Best Interest and Brokers – It Could Be Positive – ANZ”
Some participants in the mortgage industry are mounting a push to argue a switch from mortgage broker commission payments, which normally includes an upfront fee and a trailing payment for the life of the loan paid by the lender to the broker, to a fixed fee for advice would be “anti-competitive. The former Mortgage Choice … Continue reading “Would Switching To Fee For Service For Mortgage Brokers Be “Anti-competitive”?”
From The Adviser. The financial services regulator has told the Productivity Commission that there is now “an industry of referrers” who are often being paid the same amount as mortgage brokers despite doing less work. At the final day of public hearings for the Productivity Commission’s (PC) inquiry into competition in the Australian Financial System, the … Continue reading “ASIC Highlights Burgeoning Referrer Market”
From Australian Broker. Productivity Commission chairman Peter Harris defended his agency’s criticism of broker commission in its report on competition in financial services, as he highlighted again the high cost of mortgage brokers. Speaking at a Committee for the Economic Development of Australia event yesterday, Harris said more than $2.4bn is now paid annually for … Continue reading “Productivity Commission and Mortgage Brokers”
From The Adviser. The financial services regulator has backed claims from the Productivity Commission that “there are conflicts of interest” in the way that home loans are sold through mortgage brokers “where some of those mortgage broking firms may be owned [by lenders] as well”. Speaking at the Parliamentary Joint Committee on Corporations and Financial … Continue reading “Are Mortgage Brokers Conflicted?”