First survey of brokers reveals more than 9/10 against as industry leaders turn against review
First survey of brokers reveals more than 9/10 against as industry leaders turn against review
91.25% of brokers do not agree with the Sedgwick Review’s opinion that mortgage broker commissions need to be more tightly regulated, a survey by HashChing has found.
The broker comparison site surveyed more than 300 of their brokers on the Sedgwick Review, which recommended that “banks adopt approaches to the remuneration of aggregators and mortgage brokers that do not directly link payments to loan size”; essentially an end to percentage-based commissions. All four major banks have explicitly committed to implementing all of Sedgwick’s recommendations.
Since the Review was published in mid-April a number of industry leaders have given their views on it.
The Australian reported Aussie founder John Symond as saying that “hopefully the banks won’t come out and do anything too stupid…it won’t be a case of ‘let’s just cut commissions’ because that will absolutely blow up in the face of the banks.” Aussie is majority-owned by CBA and so Symond’s intervention is particularly notable.
Mortgage Choice CEO John Flavell claimed Sedgwick Review was overly reliant on anecdotes and short on facts and questioned its legitimacy: “it is not the brokers or the Australian Bankers Association’s role to tell regulators what to do, or what changes need to be made.” When Sedgwick’s Review was published Mortgage Choice’s share price fell, albeit only by 2% and has since recovered. When ASIC published their separate Review of Mortgage Broker Remuneration on the 16 March Mortgage Choice’s share price actually increased.
Voices inside the banking industry have also questioned the review. Yesterday the Australian Financial Review reported that the boss of the Finance Sector Union national secretary Julia Angrisano had criticised changes to broker remuneration. "Without immediate guarantees to those directly employed lenders that they won't be disadvantaged, then there is a real risk of a big exodus to the broker channel and that is something we are raising as a matter of urgency with all banks". Angrisano claimed.
91.25% of brokers do not agree with the Sedgwick Review’s opinion that mortgage broker commissions need to be more tightly regulated, a survey by HashChing has found.
The broker comparison site surveyed more than 300 of their brokers on the Sedgwick Review, which recommended that “banks adopt approaches to the remuneration of aggregators and mortgage brokers that do not directly link payments to loan size”; essentially an end to percentage-based commissions. All four major banks have explicitly committed to implementing all of Sedgwick’s recommendations.
Since the Review was published in mid-April a number of industry leaders have given their views on it.
The Australian reported Aussie founder John Symond as saying that “hopefully the banks won’t come out and do anything too stupid…it won’t be a case of ‘let’s just cut commissions’ because that will absolutely blow up in the face of the banks.” Aussie is majority-owned by CBA and so Symond’s intervention is particularly notable.
Mortgage Choice CEO John Flavell claimed Sedgwick Review was overly reliant on anecdotes and short on facts and questioned its legitimacy: “it is not the brokers or the Australian Bankers Association’s role to tell regulators what to do, or what changes need to be made.” When Sedgwick’s Review was published Mortgage Choice’s share price fell, albeit only by 2% and has since recovered. When ASIC published their separate Review of Mortgage Broker Remuneration on the 16 March Mortgage Choice’s share price actually increased.
Voices inside the banking industry have also questioned the review. Yesterday the Australian Financial Review reported that the boss of the Finance Sector Union national secretary Julia Angrisano had criticised changes to broker remuneration. "Without immediate guarantees to those directly employed lenders that they won't be disadvantaged, then there is a real risk of a big exodus to the broker channel and that is something we are raising as a matter of urgency with all banks". Angrisano claimed.
