the adviser logo

Bank chief calls for greater transparency in broking

by James Mitchell5 minute read

The head of one of Australia's leading banks has flagged bank ownership of mortgage brokers as an area that requires greater transparency.

Speaking on a panel at the AFR Banking & Wealth Summit this week, Suncorp CEO John Nesbitt called out a number of competitive distortions in the Australian mortgage market.

Mr Nesbitt argued that Australian lenders currently operate on an “uneven playing field” that needs to be “evened out”.

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

“Particularly around the risk weights, around funding benefits that flow to the majors and also around regulation and transparency around [mortgage] broking,” he said.

“Many brokers today are predominantly owned by the majors and there should be transparency there.”


Financial System Inquiry (FSI) chair David Murray was also on the panel but did not comment on the issue.

Last year, Mr Murray’s interim report found that vertical integration may have the potential to distort the way in which mortgage brokers direct borrowers to lenders.

While the report conceded that it remains unclear whether the majors are abusing their power, it did note that the Australian Competition and Consumer Commission “has taken relatively little action against the major banks in recent years”.

Smaller banks have consistently called for greater transparency of bank-owned broker groups.

In its second submission to the Murray Inquiry, the Customer Owned Banking Association argued that borrowers need to understand whether a mortgage broker is genuinely independent, whether the broker is offering products from a narrow or broad range of lenders, and whether some lenders are ‘preferred’ by the broker.

[Related: Consumers in the dark about who they're really banking with]

Bank chief calls for greater transparency in broking
TheAdviser logo

James Mitchell

James Mitchell


James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.


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


sam jolley elders ta iwsfut

Elders welcomes 1st national growth and asset finance manager

Elders Home and Commercial Finance, the independent broking arm aligned with the real estate network of Elders Ltd,...

rael ross butn ta rerexr

Butn achieves record originations in July

Cash flow financier Butn has released a trading update, revealing that its 2023 financial year commenced with a new...

daniel tuttlebee resimac asset fInance ta l27zun

Resimac takes controlling stake in Sonder

Resimac Asset Finance has expanded its acquisition stake in equipment finance business Sonder Equipment Finance...

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