Bankwest’s head of specialist lending Ian Rakhit talks to The Adviser about broker commissions and the bank’s commitment to the third party distribution channel
HOW IMPORTANT IS THE BROKER CHANNEL TO BANKWEST?
The broker market is of huge significance to Bankwest. A majority of our mortgage balances have been introduced by brokers and we remain committed to this channel as a means of delivering our volumes and helping more and more customers to purchase their home, refinance or invest. With the mortgage market as competitive as it is today, time poor borrowers are becoming increasingly savvy and will continue to turn to mortgage brokers in search of the deal that meets all of their financial requirements best. Equally, the broker industry adds an important distribution channel on the eastern seaboard, where Bankwest does not have the luxury of as many points of sale as we enjoy in Western Australia.
IN MAY, BANKWEST PAID OVER $1 MILLION IN INCREASED COMMISSIONS TO BROKER PARTNERS AS PART OF THE BANK’S ‘QUALITY COMMISSION’ PROMOTION. HOW WAS THAT RECEIVED?
The Quality Commission bonuses paid to brokers over the past year were viewed by many brokers as refreshing – particularly as in recent years, many lenders have reduced commission structures across the board. Most importantly, the increased commission offering was not simply recognition of volume production; it rewarded error-free loan applications. Quality submissions mean a reduction in processing times that allows us to deliver a faster turnaround time.
WILL YOU LOOK TO IMPLEMENT A SIMILAR PROMOTION IN THE FUTURE?
Based on the success of the promotion that commenced in October 2010, there’s no reason why we would not offer a further quality bonus at some point in the future – not only for high quality submissions but for high conversion rates. Campaigns like this, with a ‘bonus’ commission, reward the good behaviours that generate a better experience for all parties.
DO YOU HAVE ANY PRODUCT OR POLICY CHANGES IN THE PIPELINE?
As a challenger brand, we will continue to innovate around both product and policy to adapt to changing market conditions as well as to customer wants and needs. No better example of this is the recently launched 97 per cent LVR loan to assist first home owners in Western Australia, which we are currently piloting.
HOW IMPORTANT ARE AUSTRALIA’S SECOND TIER LENDERS TO COMPETITION IN THE MORTGAGE MARKET?
With many concerned about a developing banking monopoly in Australia, the second tier lenders are critical to offering greater choice to borrowers. Australian consumers and brokers alike not only want differentiation in product offerings, they also want excellent customer service and to be put first. As a bank, we will continue to strive to stay on top of our big four rivals in terms of customer satisfaction.
WHAT ARE BANKWEST’S BROKER MARKET SHARE GOALS FOR 2012?
Market share is the true benchmark of performance against competitors in the broker market and we are looking to continue the phenomenal growth achieved in recent years. In Western Australia, where the Bankwest brand is iconic, we will look to continue to dominate the market as the most utilised lender with a majority of our panel aggregators. On the eastern seaboard, the focus will be on retaining the top spot held with some groups, and increasing penetration with the remainder.
WHAT DO YOU HOPE TO ACHIEVE IN THE COMING PERIOD?
With my role comes great satisfaction, and over the past 18 months I have very much admired the leadership of the various broker head groups and, in addition, the many individual brokers and their teams who demonstrate professionalism, customer commitment and quality – all of which encompass the Bankwest ethos. As a bank, our goal is to continue to grow our business at the rate achieved in recent years. Last year, Bankwest achieved the milestone of acquiring our one millionth customer (with one in five of those introduced by a broker). The next goal is growing it to two million, with our broker channel continuing to play a significant role in achieving this. With product and policy innovation and a highly engaged sales force, we are in a sound position to do just that.
One of my biggest goals is the improvement of ‘quality’. The need for both brokers and lenders to strive for efficiencies within our business and to eliminate the waste of reworking loan applications due to error-ridden submissions is crucial. An error-free application ensures a happier customer experience by reducing both processing costs and more importantly, speedier turnaround times. Bankwest is committed to working more closely with our broker partners, providing more coaching and training to ensure we achieve ‘quality’ on a consistent basis.
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