Banks changes encouraging growth on non-bankmarket
New Zealand Finance says changes to home loan commission structures by banks will create opportunity and this will only help develop the non-bank housing market in New Zealand.
Wednesday, August 17th 2005, 5:57AM
"NZ Finance is continuing to develop new products in this sector to take advantage of the opportunities being created,” NZ Finance managing director John Callaghan says.
The latest bank to announce changes is Westpac. It is changing the structure of commission payments to mortgage brokers. It is increasing upfront payments from .60% to .75% plus a performance component of .10%.
They will stop paying trail on new loans from that date. Existing trail payments will remain in place.
“This change was not unexpected by Westpac as a result of all the other main banks moving away from trail payment," Callaghan says.
Callaghan says the financial effect on NZ Finance is "minimal as a result of the growth of our mortgage brokering division, New Zealand Mortgage Finance throughout New Zealand."
"Total revenue for the first four months of this financial year, for NZMF, is 86.3% up on the same period last year,” he says.
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