Powered by MOMENTUM MEDIA
the adviser logo
Broker

Major bank sheds light on new broker segmentation model

by Charbel Kadib6 minute read

The new tiered broker model to be introduced by a big four bank will be “quality-based” rather than “volume-based”.  

Westpac has shed light on its new broker segmentation model, introduced along with its new commission changes based on the Combined Industry Forum’s (CIF) recommendations.

To continue reading the rest of this article, create a free account
Already have an account? Sign in

The bank has said that the new model, which has been renamed “Priority Broker Support”, will move from being “volume/dollar-based” to “quality-based”.  

Westpac’s new model, effective 1 January 2019 across all banking brands under the Westpac Group, will be broken up into three tiers. The higher the tier, the more support and service (such as faster turnaround times and access to credit specialists) brokers will qualify for.

Advertisement
Advertisement

Brokers will begin in the “Accredited” tier, with the opportunity to move into the preferential “Gold” tier and “Platinum”* tiers.

The bank has said that to qualify for a higher level of support, brokers will be required to:

  • Consistently satisfy application quality measures – now known as the Customer Accuracy Rate (CAR)
  • Meet a certain number of applications – referred to as an activity measure

Westpac stated that the CAR relates to the rate in which brokers provide all the following information in a loan submission:

  • Funds to complete: Includes providing correct and complete evidence of genuine savings or home equity
  • Income: Includes providing proof of PAYG income or rental income evidence and correct income verification
  • Liabilities and Expenses: Brokers ensure all liabilities and commitments are accounted for such as credit card and personal loans as well as all living expenses
  • Responsible lending and application requirements: Brokers ensure electronic lodgement is completed correctly and all application requirements have been fulfilled
  • Security: For example - the contract of sale is completed and signed, and the loan input is complete and correct

Westpac added: “To help make it easier to achieve the best customer outcomes by minimising errors on the applications [brokers] submit, [brokers will] be provided with detailed criteria related to the Customer Accuracy Rate (CAR).

“Support will also be available from our business development managers to assist you in improving quality over time.”

Tier criteria

More specifically, to enter the second Gold tier, brokers must have a Customer Accuracy Rate of 85 per cent and submit between six and 11 loan applications to Westpac per half year.

To be eligible for the highest Platinum tier, brokers are required to have a Customer Accuracy Rate of 85 per cent and submit at least 12 loan applications to Westpac per half year.

The base Accredited tier applies to remaining brokers that do not meet the above requirements.  

Westpac has added that there is no requirement for brokers to meet a dollar volume threshold.

The banking group has claimed that the new tiered system could help “ensure the primary focus is always on good customer outcomes”.

According to the bank, loan applications submitted by brokers in the Gold and Platinum tier would be assessed within 24 hours, with brokers in the Platinum tier also given access to credit specialists.

Westpac said that “standard turnaround times” apply for loans submitted by brokers in the Accredited tier.

Moreover, the big four bank has stated that when Priority Broker Support is introduced on 1 January 2019, a transition period will apply where brokers will retain their current tier for six months.

Westpac added that during the transition period, its BDMs would ensure [brokers are] familiar with the changes and would keep brokers updated on their current standing.

The big four bank added that when the transition period expires, brokers would continue to receive support from its BDMs to ensure brokers maintain or improve their current tier.

“If it’s looking like you may not maintain your current tier, our business development managers will provide you with support and an action plan to help you improve your quality.”

The new tier system will apply to Westpac, BankSA, Bank of Melbourne and St. George.

*Under the BankSA, Bank of Melbourne and St. George models, the Platinum tier will be known as 'Flame'.

[Related: Another major bank changes broker commissions]

Major bank sheds light on new broker segmentation model
climbing bulb
TheAdviser logo
climbing bulb

Charbel Kadib

Charbel Kadib

AUTHOR

Charbel Kadib is the news editor on The Adviser and Mortgage Business.

JOIN THE DISCUSSION

You need to be a member to post comments. Register for free today

MORE FROM THE ADVISER

mark lewis fast ta llosc4

In Memoriam: Mark Lewis, 1963–2022

Mark Lewis passed away on Saturday (13 August). Mr Lewis was a well-known identity in the third-party broker...

READ MORE
anthony waldron mortgage choice ta ithtxm

Broker expertise key for securing right loan: Mortgage Choice

The data, which is derived from a June survey of 1,002 broker customers and conducted by Honeycomb Strategy,...

READ MORE
Mark Bouris new ifa

Brokers need to focus on the ‘value-add’: Mark Bouris

With competition among brokers increasing as the number of brokers rises – coupled with the fact that fewer...

READ MORE
magazine
Read the latest issue of The Adviser magazine!
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
Read more