Powered by MOMENTUM MEDIA
Powered by MOMENTUM MEDIA
SUBSCRIBE TO OUR NEWSLETTER SIGN UP
Powered by MOMENTUM MEDIA

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

CBA announces new commissions structure

Staff Reporter 2 minute read

The Commonwealth Bank of Australia (CBA) this afternoon revealed changes to broker remunerations after weeks of discussion with aggregation groups.

The new structure, to be phased in over the coming months, will see brokers forego the first year’s trail commission, with payment settling at 0.20 per cent – down from 0.25 per cent.

Up-front commissions will also be trimmed from a maximum 0.70 per cent to 0.65 per cent.

In line with other lenders, CBA will also reward brokers for cross selling, online-lodgements as well as for the quality of their business.

Kathy Cummings, CBA head of third-party banking, said the changes realigned broker remuneration with market economics and would ensure the sustainability of the mortgage broking industry.

Advertisement
Advertisement

Ms Cummings also revealed that CBA will launch a new broker website called CommBroker to help brokers track loans, along with a new broker platform and a number of service improvements.

CBA also confirmed that there are no plans to change minimum volumes though current levels would be enforced.

“We believe in providing a transparent model to the industry without favouring particular groups; our focus is on quality,” Ms Cummings said.

“At a time when some lenders are cutting commissions without any consultation or just pulling out of the industry with no notice, the message I want brokers to take from these changes is that CBA is in this business for the long-term,” she said.

PLAN Australia CEO Ray Hair said that while he does not welcome any reductions to broker commissions, he believed CBA had taken a well-structured consultative approach on the issue.

“Clearly CBA are not cutting commissions as deeply as say Westpac, and they are looking at opportunities to maximise outcomes,” he said.

“Rather than forcing brokers to cross sell, they are providing opportunities for rewards for those brokers who do."

In terms of a possible broker shift from writing CBA loans due to commission reductions Mr Hair said any response "would not be significant", however he noted that volumes could be impacted.

Published: 21-05-08

CBA announces new commissions structure
default
TheAdviser logo
default

TODAY'S POLL

View results >

Who do you aggregate through?

Thank you for your vote, you can see the results here.

more from the adviser
mortgage choice 850 Major brokerage appoints new GM of distribution

Mortgage Choice has announced that Citi’s former head of bankin...

ANZ new still ta ANZ extends business loan terms

The major bank has announced that it will extend the maximum loan...

cash money rolls Credit growth stunted by dive in business lending

Credit growth has waned as a result of a sharp drop-off in busine...

FROM THE WEB