Get notifications in real-time for staying up to date with content that matters to you.
A non-major lender has announced that it is implementing changes to its broker commission payment model, including changes to trail and the adoption of CIF recommendations, effective from 1 July.
Bankwest has said that it is bringing in the changes to “align itself with evolving industry practice and regulator expectations”.
The changes, which will be effective on settlements from 1 July 2018, include:
There will be no changes to the upfront commission rate.
| Current commission rate | New rate from 1 July 2018 | |
| Upfront | 0.70% | 0.70% |
| Year 1 | 0% | 0.15% |
| Year 2 | 0.15% | 0.15% |
| Year 3 | 0.20% | 0.15% |
| Year 4 | 0.20% | 0.20% |
| Year 5 onwards | 0.25% | 0.20% |
Commenting on the industry recommendations, Bankwest general manager for third party Ian Rakhit said: “Bankwest has been a very long-standing supporter of the broker industry, going back to the very start some four decades ago, and we remain committed to brokers as a channel of choice for customers.”
He added: “We support the current upfront and trail model as well as the improvements to the model outlined in the ASIC review and the Combined Industry Forum (CIF) recommendations.
“We understand the lack of Year 1 trail has been outstanding for some time and we are pleased to reintroduce this to bring us back in line with the market.
“Our contract stipulates that trail commissions represent payment for continuous customer maintenance and services, and we believe trail remains warranted for brokers to ensure ongoing support is provided to customers they refer to Bankwest.”
PROMOTED CONTENT
The bank is the first lender to make major moves to change broker remuneration following the ASIC remuneration review, Combined Industry Forum package reforms and the ongoing commissions.
The Adviser has asked Bankwest's parent company, CBA, if similar changes will be made by the major bank but has not yet received a response.
[Related: NAB backs remuneration structure but calls for ‘improvements’]
The Australian Law Reform Commission has sought opinions from bro...
Concerns around navigating government grants, cash flow, and “s...
The state has started distributing cash grants to businesses affe...
Join Australia's most informed brokers
Do you know which lenders are providing brokers and their customers with the best service?
Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!
The number one magazine for mortgage brokers
The Adviser is the number one magazine for Australia's finance and mortgage brokers. The publications delivers news, analysis, business intelligence, sales and marketing strategies, research and key target reports to an audience of professional mortgage and finance brokers
Do you charge fees for mortgage writing services?
