tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Tuesday, May 18th, 6:07PM

Mortgages

rss
Latest Headlines

PAA slams banks for undermining advisers

Unfair bank practices designed to undermine advisers have incurred the wrath of the Professional Advisers Association (PAA) and prompted it to go into bat for its members.

Thursday, June 29th 2017, 1:01PM 1 Comment

by Miriam Bell

In response to adviser concerns about the practices of some banks, the PAA Board sent a fighting letter to its members this morning.

The letter said that the PAA has been made aware of the unsavoury practices of one major bank and will be taking the issue up with them.

It also said that it seems some banks are happy to undermine the client-adviser-bank relationship and to alienate the adviser to the advantage of their own branch, mobile lending staff and corporate coffers.

Doing this ignores the client’s channel of choice, deprives the client of impartial advice and has the potential to turn clients away from the adviser as they can’t offer the same products as the bank can.

This type of disingenuous business tactic must be seen for what it is and be stopped, the letter said.

PAA CEO Rod Severn said the board sent the letter because it wants its members to know that they will be taking up these issues with the bank involved.

“We don’t appreciate some of the actions that some banks seem to be taking towards advisers and we feel that that are bad for both advisers and clients.”

The bank in question has withdrawn certain products from advisers but is still offering them to clients through their own channels.

Severn said the PAA understands that banks are businesses and, as such, are going to be competitive.

“But we are concerned about ensuring a level playing field and not impacting on the ability of an adviser to give choices to, and act in the best interests of, their clients.

“Either banks should be offering their products across the board or not at all. The PAA thinks the products should be available to everyone.”

He said that not doing so impacts on the ability of advisers to offer the best range of products for their clients and to present them with the full view of what is available.

Veteran advisor Geoff Bawden, of New Zealand Property Finance, agreed with the sentiments expressed in the PAA letter as there are some unfair practices going on.

“A lot of what happens in this industry is unfair. It has never been a level playing field and it never will be.

“Look at clawbacks which are loaded against advisers. And the banks are innately competitive when it comes to clients. Banks tend to see advisers as acquisition people only.”

All of this flies in the face of putting the client first, and giving the client choices, which is what should be everyone’s concern, he said.

Despite this, Bawden thinks the board is treading on dangerous ground.

“Banks have very deep pockets and are prepared to respond quite assertively when such issues are raised.

“The board could be opening up a whole can of worms. Or the banks could simply ignore it which means little would be achieved.”

An FMA spokesperson said that it was not for the FMA to comment on disputes between banks and advisers.

“But if there are specific instances of what is believed to be poor conduct by institutions or advisers then the FMA would like to hear about it.”

 

Tags: banks FMA PAA Rod Severn

« Hundreds of would-be advisers sign upInvestor lending decline continues (+GRAPH) »

Special Offers

Comments from our readers

On 29 June 2017 at 11:56 am AFA Muggins said:
As a member of the PAA, I received the email, and have read this article as well. At the time, and now, I still don’t know what on earth the PAA are actually talking about.

Maybe it is something to do with mortgages (“ The bank in question has withdrawn certain products from advisers but is still offering them to clients through their own channels.”).

I have no idea.

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 2.25 2.59 2.89
ANZ 4.44 2.85 3.19 3.49
ANZ Special - 2.25 2.59 2.89
ASB Back My Build 1.79 - - -
ASB Bank 4.45 2.25 2.59 2.89
Basecorp Finance 5.49 - - -
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.25 2.55 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 2.85 3.15 3.39
Lender Flt 1yr 2yr 3yr
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland Bank - Online ▼1.95 ▼1.85 2.35 2.45
Heretaunga Building Society 4.99 3.40 3.50 -
HSBC Premier 4.49 2.25 2.35 2.65
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - 2.25 - -
ICBC 3.69 2.25 2.35 2.65
Kainga Ora 4.43 2.67 2.97 3.13
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.40 3.20 3.40 3.64
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.35 2.55 2.79
Liberty 5.69 - - -
Nelson Building Society 4.95 3.20 3.24 -
Pepper Essential 4.79 - - -
Lender Flt 1yr 2yr 3yr
Resimac 3.39 3.35 2.99 3.35
SBS Bank 4.54 2.69 2.99 3.29
SBS Bank Special - 2.19 2.49 2.79
Select Home Loans 3.49 3.34 2.99 3.34
The Co-operative Bank - First Home Special - 2.09 - -
The Co-operative Bank - Owner Occ 4.40 2.25 2.59 2.79
The Co-operative Bank - Standard 4.40 2.75 3.09 3.29
TSB Bank 5.34 3.05 3.29 3.59
TSB Special 4.54 2.25 2.49 2.79
Wairarapa Building Society 4.99 3.55 3.49 -
Westpac 4.59 2.85 3.19 3.49
Lender Flt 1yr 2yr 3yr
Westpac - Offset 4.59 - - -
Westpac Special - 2.25 2.59 2.89
Median 4.55 2.68 2.99 2.89

Last updated: 17 May 2021 9:05am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com