The sheer pace at which the lay of the banking space is changing at the moment is truly remarkable. Last year, when we reviewed how brokers were rating the big four banks in our “Changing times” feature (see October 2021 edition for more), we remarked how scores across the board had been plummeting while satisfaction in the big four, in particular, was falling.

But now, less than a year later, things are starting to look up for Australia and New Zealand Banking Group (ANZ), the Commonwealth Bank of Australia (CBA), National Australia Bank (NAB), and Westpac Banking Corporation (Westpac).

All four banks have been focusing on improving their third-party channel experiences in the last 12 months. All four have embarked on some kind of rapid digitisation plan to improve their mortgage proposition and settlement speeds in the last year, and – perhaps as a result – all four have been growing their loan books (some more successfully than others).

The proof is in the pudding. When Momentum Intelligence surveyed brokers for its Third-Party Lending Report earlier this year (see box out for methodology), the major banks had all improved their scores on 2021.

How the big four fared against one another

CBA was once again ranked first among the big four banks this year, receiving a rating of 79 per cent of the maximum score – up 9 percentage points on last year.

In fact, CBA made it into the top 10 of all lenders ranked by brokers in the 2022 Third-Party Lending Report, coming in at seventh place (despite no major banks having made it into the top 20 highest-rated lenders in 2021).

Of all the 37 lenders rated by brokers, CBA actually was particularly well liked for its technology offering to brokers (with a score of 84 per cent for this category). It ranked first for its broker portal/online tools, its upfront valuations, and its online application tracking and also scored above industry average across several attributes
including credit assessment staff and product policy.

NAB also fared better this year, remaining the second most highly rated big four bank and ranking 15th of all 37 lenders.

For NAB, its tech (particularly upfront valuations and online resources) and products were its two main key drivers (with a score of 80 per cent and 76 per cent, respectively).

While both Westpac and ANZ improved their scores this year, they remained well below average scores across many attributes. In fact, Westpac (and its subsidiary St.George) ranked 35th and 36th of the 37 lenders in the report (in front of only P&N Bank), with ANZ only just pipping them to 34th position.

Though starting from a lower bar, Westpac’s highest-rated category was its technology (76 per cent rating), with upfront valuations leading this for them.
It’s the bank’s speed and personnel that seem to bring it down. While both of these were scored more favourably by brokers this year, they remain below average.

Meanwhile ANZ’s highest-rated category was equal tech and products (both 74 per cent).

Unfortunately for ANZ, however, old wounds run deep – and the clean-up of its blowouts still has some brokers nervous about using the lender. In fact, while its score for the category of “speed” improved on last year – it was still a very low score of 44 per cent.

Interestingly, however, this may not be such an issue for brokers moving forward – as the bank has seemingly fixed its turnaround problem (according to the monthly Broker Pulse survey conducted by Momentum Intelligence).

Indeed, recent data from the monthly Broker Pulse survey shows that turnarounds are generally less important to brokers given that they’ve improved across the board and are now, generally, standardised.

The Third-Party Lending Report echoes this trend. in 2021, turnarounds had been the main influencing factor when it came to which lender a broker chose to use (at 93.3 per cent), but this year turnarounds had dropped back to be only the third-most important attribute when it came to choosing a lender (at 89.89 per cent).

While rates had not yet started to rise at the time of the survey being conducted, expectations were that they were imminent – with fixed rates having already risen to take them into account. As such, it’s perhaps unsurprising that this time around, product policy and product pricing were the two most important factors to brokers when choosing a lender partner (91.3 per cent and 90.28 per cent, respectively).

Looking to the future, all four major banks are looking at growth.

NAB has acquired 86 400 for its digital brand UBank and is rapidly expanding out that presence in the broker channel, CBA has its fingers in a lot of pies through its x15ventures and is constantly looking at product innovation, Westpac will launch a digital mortgage in the final quarter of this calendar year that can reportedly gain unconditional approval in as little as 10 minutes (though broker launch isn’t expected until next year), and ANZ recently announced its intention to acquire Suncorp Bank – which would immediately increase its loan book and offering.

Add into that the recent move to potentially add both ANZ and Westpac to the government’s Home Guarantee Schemes by October, and the big four will certainly be busy. The question is: how much focus will be put into the broker channel?

What brokers say

The good

“CBA does have a very good Broker Scenario helpdesk.”

“CBA has the best online valuation tool.”

“ANZ and NAB have become increasingly flexible in the way they do business. They’re responding well to the neobank revolution.”

“ANZ is good for business applicants.”

“With NAB… they are excellent due to the nature of the credit assessors. Most are willing to provide an exception to policy if the matter can be reasonably explained.”

 The bad

“ANZ loses marks as its broker policy manual is in need of modernising. It is difficult to clarify policy.”

“ANZ and St George require constant escalation of files over and over again to settle on the due date. Without escalation and follow up, many deals would fall over because they have no idea that it’s even due.”

“CBA have issues with electronic docs constantly.”

“CBA actively stole two deals via branch network.”

“The back channel messages we received from NAB are not an indication of the actual situation. Default messages give the wrong impression.”

“The fact that Westpac can’t even provide an accurate serviceability calculator (or LMI calculator) is absolutely unfathomable.”

“Westpac’s portal is just a complete mess.”

The 17 attributes brokers were asked to rate banks on are as follows:

Products:

1. 
   Product range: Overall quality and comprehensiveness of residential mortgage products
2. 
   Product pricing: Competitiveness of pricing of products across key market segments
3. 
   Product policy: Comprehensiveness and clarity of product policies across key market segments

Personnel:

4. 
   BDMs: Overall quality of BDMs (access to BDMs, BDM proactivity and effectiveness in solving problems)
5. 
   Credit assessment staff: Access to and ease in dealing/communicating with credit assessment staff including their consistency of credit decisions
6. 
   Call centre support: Overall service quality, including staff technical knowledge, responsiveness and helpfulness. 

Speed:

7. Turnaround times: Overall end-to-end turnaround speed, including application processing, loan approval and mortgage contract timeliness

 Support:

8. 
   Client support: Effectiveness in servicing your clients post-settlement
9. 
   Broker communication: Effectiveness of communication with brokers (verbal, written or otherwise) when dealing with queries, issues, product price/policy changes or servicing times
10. 
    Channel conflict: Overall approach to the third-party channel compared with their branch network. This considers the availability of certain products, promotion of the third-party channel, preferential treatment regarding rates and LVRs
11. 
    Commitment to the broker channel: Lender’s ongoing commitment and loyalty to the channel, enhancing services and support to brokers and their businesses
12. 
    Settlement: Settlement timeliness alongside ease of signing and understanding of documents 

Technology:

13. 
    Online lodgements: Overall efficiencies, usability and functionality of the system
14. 
    Online application status tracking: The system’s features, overall efficiency and user experience
15. 
    Digital tools and online resources: Comprehensiveness of resources, such as latest forms, new products and policy information
16. 
    Upfront valuations: Overall functionality, user experience and effectiveness of the system, and whether it provides greater consistency and rigour in the valuation ordering process
17. 
    Broker website/portal: Effectiveness of broker website/portal, considering product and servicing information available and ease of navigation

The methodology

Now in its 13th year of publication, the Third-Party Lending Report helps track lender performance over time to show industry trends and changes in the competitive landscape.

The 2022 Third-Party Lending Report was conducted online between 1 March and 30 April 2022.

The survey encouraged mortgage brokers across Australia to participate in a self-assessed evaluation of lender performance from their experiences over the last 12 months. Participants were invited to complete this survey by email through The Adviser and Mortgage Business. Lenders were also encouraged to invite their affiliated brokers to contribute to the survey.

The survey received a total of 1,540 responses. After an extensive data validation process including the removal of invalid, duplicate or incomplete responses, the usable sample size for this report was 1,050 brokers. 

The full Third-Party Lending Report 2021 can be accessed via Momentum Intelligence, here.

Written by Annie Kane

Last Updated: 11 August 2022

Published: 15 August 2022