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ANZ restructures commissions

Staff Reporter 5 minute read

ANZ today confirmed its new broker commission structure to aggregation groups and brokerages.

ANZ will drop upfront commissions from 0.7 to 0.5 per cent in line with other banks, effective November 1.

However groups that hit sales volumes targets, conversion rates, on-line submissions requirements and write larger loans can boost upfront commissions to 0.70 per cent.

Those that achieve $500 million per annum will receive 7.5bps of the additional 20bps – a move that highlighted ANZ’s focus on larger volume groups.

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“We’ve found ANZ the most consultative of all the banks,” said Warren O’Rourke, national affairs manager at Mortgage Choice. “While we don’t welcome any changes to broker commissions we feel that ANZ had taken onboard many of our suggestions."

“The metrics of the restructured commissions recognise the strengths of Mortgage Choice; we feel the outcome is one that is sustainable for both the lender and us.”

X Inc CEO Jennifer Nielsen echoed O’Rourke’s sentiment.

“The important message for mortgage brokers from here is to get on top of the key quality metrics,” she said. 

“Those aggregators who have the support infrastructure to keep their organisational and individual broker work quality high are definitely the big winners out of all these changes.”

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The lender has also reduced trail commissions to 0.15 per cent for the first three years, rising to 0.20 per cent from the fourth year onwards.

The new trail commission structure will apply to all loans settled from August 15.

“We looked at the total economics around upfront and trail and it works for us to pay trail that first year and over the life of the loan,” Michael Rowland, ANZ managing director of mortgages, told Mortgage Business this morning.

“We have increased the trail after the fourth year and that’s to recognise that there is more value for us in clients staying on the books longer.”

As part of its new broker commissions restructure there will be no requirement for cross-sell to hit top commissions targets – a move welcomed by aggregation groups.

“While some brokers are very successful at cross-selling it can be complicated. A broker’s priority is that they get their client’s loan across the line and not to get distracted,” said O’Rourke.

The utilisation clawback will also be removed for all new and existing loans, effective 15th August 2008.

Published: 20-06-08

ANZ restructures commissions
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