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ANZ changes commission payments

ANZ Bank is changing the structure of its commission payments to mortgage brokers from October 1.

Wednesday, August 10th 2005, 11:20AM

by Janine Ogier

From then, ANZ will stop paying the 0.25% trail commission currently paid on new loans.

“The move is in light of pressure on home loan margins right across the board in the last year or two,” ANZ spokesman Craig Howie says.

Instead, the bank will increase the up-front commission it pays from 0.625% to 0.7% and it will pay an at risk component of up to 0.2%, subject to various performance criteria.

ANZ had been consulting extensively with mortgage brokers in recent months, Howie says.

“We think the new structure meets both the bank’s objectives of providing customers with competitive mortgage products and at the same time acknowledges the broker feedback we got about bringing a quality and volume component into the commissions,” he says.

The new commission would differ broker-to-broker and deal to deal as there was a component built in for volume and value.

“ANZ definitely remains committed to the mortgage broker channel,” Howie says.

Looking at the financial implications, Mike Pero Mortgages chief executive Jeff Staniland says, all things being equal, the listed company’s revenue would increase in the first full year under the new arrangement.

“Beyond that, the outcome is less certain and will be dependent on a number of different factors, including our mix of business among different lenders and the rate of growth in mortgages arranged,” he said.

Westpac is now the only high street bank paying trail commission to mortgage brokers. Other first mortgage lenders paying trail commission include Sovereign, Superbank and HSBC, while lenders such as Bluestone, Liberty and Pioneer also pay it.

Brokers would have preferred to keep trail commission, Staniland says.

“It is an evolutionary thing. (Lenders) started out competing on price, then they competed for volume. Now they are saying we will compete for volume and also for quality, and they are changing the (commission) structure,” he says.

« Lenders tweak ratesNZ Finance expects 50% return on investment »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 5.94 - - -
AIA - Go Home Loans 8.49 6.45 5.89 5.79
ANZ 8.39 6.95 6.39 6.39
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 6.35 5.79 5.79
ASB Bank 8.39 6.45 5.89 5.79
ASB Better Homes Top Up - - - 1.00
Avanti Finance 8.90 - - -
Basecorp Finance 9.60 - - -
BNZ - Classic - ▼6.29 ▼5.79 5.79
Lender Flt 1yr 2yr 3yr
BNZ - Mortgage One 8.44 - - -
BNZ - Rapid Repay 8.44 - - -
BNZ - Std 8.44 6.45 5.89 5.79
BNZ - TotalMoney 8.44 - - -
CFML 321 Loans 6.70 - - -
CFML Home Loans 6.95 - - -
CFML Prime Loans 8.75 - - -
CFML Standard Loans 9.70 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - ▼6.15 - -
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Owner Occ 8.15 ▼6.35 ▼5.79 ▼5.69
Co-operative Bank - Standard 8.15 ▼6.85 ▼6.29 ▼6.19
Credit Union Auckland 7.70 - - -
First Credit Union Special - 6.75 6.35 -
First Credit Union Standard 8.50 7.35 6.95 -
Heartland Bank - Online 7.99 6.69 6.35 6.15
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.00 6.50 -
ICBC 7.85 6.45 5.99 5.89
Kainga Ora 8.39 7.05 6.59 6.49
Kainga Ora - First Home Buyer Special - - - -
Lender Flt 1yr 2yr 3yr
Kiwibank 8.25 ▼7.19 ▼6.69 ▼6.59
Kiwibank - Offset 8.25 - - -
Kiwibank Special - ▼6.29 ▼5.79 ▼5.79
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 8.75 6.85 6.39 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank 8.49 7.19 6.49 6.49
SBS Bank Special - 6.59 5.89 5.89
SBS Construction lending for FHB - - - -
Lender Flt 1yr 2yr 3yr
SBS FirstHome Combo 5.94 5.59 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
TSB Bank 9.19 7.25 6.79 6.69
TSB Special 8.39 6.45 5.99 5.89
Unity 8.64 ▼6.45 ▼5.89 -
Unity First Home Buyer special - 6.20 - -
Wairarapa Building Society 8.50 6.65 5.99 -
Westpac 8.39 7.45 6.79 6.59
Westpac Choices Everyday 8.49 - - -
Westpac Offset 8.39 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 6.85 6.19 5.99
Median 8.44 6.67 6.29 5.89

Last updated: 19 September 2024 9:31am

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