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Westpac defends exit fee decision

Staff Reporter 3 minute read

Jessica Darnbrough

Westpac has bucked the trend amongst the majors stating today that its mortgage exit fee will remain in place.

A Westpac spokesperson today told The Adviser that the major would not be dropping its$700 exit fees.

Last week both ANZ and NAB confirmed they would slash their fees in line with the government crackdown, but Westpac seems determined to stand its ground.

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Westpac chief executive officer Gail Kelly told the Australian Financial Review that banks that remove their exit fees will be forced to recoup these costs elsewhere.

She said keeping mortgage exit fees ultimately provided customers with greater choice as they can avoid paying the fee altogether if they stay with the bank.

Ms Kelly’s sentiment has been echoed by brokers.

Simplify Your Mortgage’s managing director Nathan Daniell agreed that if mortgage exit fees were removed, the banks would look to recoup the costs elsewhere.

“The big banks don’t really care if the government forces the exit fees to be reduced because they will increase application fees, reduce mortgage broker commissions and change the clawback of commissions to ensure they don’t make a loss,” Mr Daniell told The Adviser.

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