Speaking after CBA moved to disaccredit inactive brokers, the group executive of AMP Bank has said banks of all sizes should compete through the broker channel to ensure lending is sustainable and competitive.
The group executive of AMP Bank has called out lender behaviours that reduce broker access, saying that this could impact competition in the lending landscape.
On Friday (19 June), the Commonwealth Bank of Australia (CBA) began disaccrediting brokers who had not written a loan with the major bank in over 12 months, as it focuses its broker relationships with established broker partners/frequent CBA loan writers.
The bank said it had made the move to ensure that brokers writing CBA loans had current and adequate knowledge of its products, policies, and processes (as required with Clause 33 of its Mortgage Broker Code of Conduct).
Other major banks have also recently moved to prioritise a smaller cohort of brokers, with National Australia Bank (NAB) having recently said it was moving to a “targeted” approach by “deepening relationships with valued brokers to drive growth in priority segments”.
Both CBA and NAB have seen their broker flows reduce in recent years, as they prioritise investment in the proprietary and digital channels.
Speaking to The Adviser following the move, Sean O’Malley, AMP Bank’s group executive, lampooned moves by lenders to restrict the number of brokers who can access their products, particularly given that a record proportion of borrowers now use a mortgage broker for their credit needs.
The group executive of AMP Bank – which sees around 95 per cent of its mortgage business come from the broker channel – said: “Recent market dynamics that constrain broker access to lending options risk reducing choice for Australian borrowers.
“Choice in banking is critical. Brokers are a key part of that choice, helping Australians compare options, access competition and secure the right lending outcome for their circumstances. The ongoing popularity of brokers reflects their value.
“That’s why AMP Bank remains firmly open for business with brokers. We’re continuing to invest in making it easier for brokers to deliver faster decisions, greater certainty and better outcomes for their clients.”
Brokers have also taken to The Adviser to voice their thoughts about the move to drop brokers who do not write adequate volumes.
While some have said that the banks should instead be “selling the benefits and positives” of using the bank’s products, others have suggested that the major bank “doesn’t offer anything unique the other majors can't accommodate”.
What are your thoughts on the minimum volume requirements for brokers to maintain accreditation? Let us know in the comments below!
[Related: CBA to disaccredit inactive brokers]
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