IING DIRECT told mortgage managers this week that it has capped the amount of wholesale funds it will make available at the current delivery rate, however its retail mortgage business would be unaffected.
The move to ration funds was in response to the increased demand from mortgage managers as fewer wholesale lenders are now active in the market.
Brett Mansfield, ING DIRECT head of mortgage management, said the bank’s decision was made simply to preserve its funding supply.
“We have seen a significant inflow of business over and above what we ever anticipated as many of our competitors scale back significantly – Macquarie being the most notable example,” he said.
“It’s not a big market at the moment.
“If you look at the competitive set you’ve got GE Money, Adelaide Bank and Challenger still there and we will certainly remain competitive within that group,” he said.
Mortgage managers that go above agreed volumes will still be funded but at a higher delivery rate.
“If demand exceeds our supply then we will need to go to market, and any additional funds would of course come with a very different delivery rate – more reflective of the current cost of funds,” Mr Mansfield said.
Despite tight management of wholesale funds, the bank insisted there would be no impact on the business’ retail arm.
“ING DIRECT prides itself as being a true supporter of the third-party channel,” Brett Morgan, ING DIRECT executive director of mortgages, told Mortgage Business.
“We believe that our branchless bank model, value-for-money mortgage products and industry leading broker and customer satisfaction levels are testament to our commitment to this channel,” he said.
ING DIRECT also confirmed it is in discussions with aggregator partners to review commissions and will announce any changes in coming weeks.
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