ASB keeps ownership of Sovereign Home Loans
Although Commonwealth Bank has sold Sovereign to AIA, the insurer’s $7 billion home loan book isn’t part of the deal.
Monday, September 25th 2017, 8:00AM
An AIA spokesman confirmed the company wasn’t buying the home loan book: “Sovereign’s home loan book is not part of the acquisition deal.”
ASB said that: “Sovereign Home Loans, which has been part of ASB for a number of years and is not a direct party to the transaction.”
“The intention is for Sovereign Home Loans to continue its close relationship with Sovereign up to, and following the sale.”
Head of Sovereign Home Loans, Adrian Chase, said because of the size of the business, ASB doesn't want to play around with it too much.
A number of advisers spoken to say there has been no communication from Sovereign about the future of the home loans business.
Many are worried because Sovereign paid trail commissions and ASB pays up front commission. Their concern is that a significant portion of their business value is tied to the trail commission they receive from ASB.
ASB general manager specialist lending Claire McKinnon says "we have no plans to change the Sovereign Home Loans remuneration model."
“Sovereign Home Loans remains fully owned and operated by ASB and there are no changes to the way the home loans are processed. Business as usual," the bank said in a statement.
OPINION: What now for Sovereign?
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