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TSB cuts broker accreditations

TSB Bank is set to slash broker accreditations at group and company level ahead of the new licensing regime.

Friday, February 26th 2021, 7:21AM 7 Comments

According to several industry sources, including senior figures at two adviser groups, TSB has written to both group heads and individual businesses to notify them of the changes.

Groups and individuals have been told that TSB is taking the action due to the new licensing regime.

The lender is understood to want to reduce the number of brokers it works with, as it does not have the resources to cope with the regulatory oversight needed under the new regime. 

TSB, led by chief executive Donna Cooper (pictured), is said to have a number of direct agreements with individual brokers, which have been under review.

Smaller groups and businesses are likely to bear the brunt of the changes, advisers said.

The changes are likely to cause turmoil for many advisers with TSB relationships.

One group executive told TMM Online that some advisers who had placed "tens of millions" with TSB had been told their relationships would end. 

"It's a pretty significant move, it's going to cause fallout, when advisers find out through no fault of their own they are being cut.

"TSB has said the impending regulatory change is to blame, and they want to deal with the uncertainty."

Another senior adviser was more circumspect over the changes.

"I believe it's mainly to do with resources, and what they can reasonably turn around given the volumes. So they are working through who gives them business and who doesn't, and looking at where they get their volume from.

"It's no different to the way Kiwibank do it, to be honest. When you are a smaller player, you can only handle so much business, so you have to be effective, otherwise you just annoy everyone," the adviser said.

TSB's call to cut some broker relationships is the clearest sign yet that lenders are adjusting their business models to fit with the new licensing regime.

The new regulatory system kicks in from March 15, and will see advisers subject to greater oversight and compliance measures, with banks also at greater risk of regulatory enforcement.

TSB did not respond to multiple requests for comment. 

Tags: licensing TSB

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Comments from our readers

On 26 February 2021 at 2:54 pm Veteran Charles said:
I have dealt with them only twice and both times it was hard to get anything done. That is what I found, not being a regular with them, not being on the inside track. I think their action makes a lot of sense, to be practical.
On 26 February 2021 at 3:37 pm Amused said:
From the 15th March all advisers in New Zealand will be required by law to put the financial interests of their clients first. Of course the vast majority of mortgage advisers operating are already doing this.

If TSB want to cancel adviser accreditations now due to some advisers giving them say 15 deals a month and only settling 1 deal I can understand this. If however TSB are cancelling accreditations due to advisers not sending them any business at all or perhaps only one or two deals a year they need have a good hard look at their current policy, pricing and service levels and understand that post 15th March it would be a brave lender to tell the Financial Markets Authority that due to its own un-competitiveness and lack of resourcing they are now shutting the door to us and our clients.

Lest we forget licensing of the financial services industry is supposed to benefit the consumer NOT a particular bank's own business model.


On 27 February 2021 at 10:02 am Laurie said:
It might be interesting for TSB Bank to measure how much of the adviser business settled to date is retained. If an adviser can't assist an existing client they helped arrange TSB Bank mortgage finance with a review or fixed rate expiry, clients may feel compelled to switch to an adviser friendly bank. The adviser has a duty of care to review the ongoing suitability of any recommended solutions, which will no longer be possible with TSB Bank.
On 1 March 2021 at 12:49 pm Amused said:
A really good comment by Laurie
On 3 March 2021 at 1:13 pm Straight shooter said:
I wonder if TSB has considered that they will be in breach of the FSLAA due to come into force. The number one desired outcome of the FSLAA and one which has been regularly spoken of by the FMA and the Minister was to ensure "better customer/consumer outcomes". So prey tell how will clients who were introduced by an advisor get a better outcome when the advisor who gave the advice can no longer deal with the provider. Can the FMA or COMCOM please explain this? or better still the CEO of TSB. To me it seems a very short sighted decision which smacks of corporate greed and failed management. If a bank cannot cope with processing volumes of simple mortgage applications then maybe they need to get better and more competent management. TSB has really gone down hill in the past few years as those form other banks have brought their poor management and attitudes with them. They used to be a great bank.
On 4 March 2021 at 9:01 am Amused said:
Well said Straight shooter. You knocked that one out of the park!

P.S. Love your last comment about staff coming from other banks bringing their poor management and attitudes with them. I think the very same thing has happened at ASB.
On 9 March 2021 at 1:50 pm Goodpeople@wealthhealth.co.nz said:
Its not that TSB haven't been aware of the Legislative changes, they have been signaled and delayed for quite some time. So this is just an excuse I think. They don't have the technology in place to manage, and that's purely a lack of investment in themselves. Such a shame, TSB is a good fit for some customers sometimes, but to be fair we put bugger all with them, so no big deal for us. We do speak highly of TSB most of the time though.

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Lender Flt 1yr 2yr 3yr
AIA 4.55 2.29 2.59 2.65
ANZ 4.44 2.89 3.25 3.39
ANZ Special - 2.29 2.69 2.79
ASB Bank 4.45 2.29 2.59 2.65
Basecorp Finance 5.49 - - -
Bluestone 3.49 3.34 2.99 3.34
BNZ - Classic - 2.29 2.59 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 2.89 3.19 3.39
BNZ - TotalMoney 4.55 - - -
Lender Flt 1yr 2yr 3yr
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 2.50 1.99 2.35 2.45
Heretaunga Building Society 4.99 3.40 3.50 -
HSBC Premier 4.49 2.25 2.35 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
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 3.50 3.50
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.35 2.65 2.65
Liberty 5.69 - - -
Nelson Building Society 4.95 3.20 3.24 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.35 2.99 3.35
Lender Flt 1yr 2yr 3yr
SBS Bank 4.54 2.79 ▲2.99 ▲3.29
SBS Bank Special - 2.29 ▲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 2.29 2.59 2.79
The Co-operative Bank - Standard 4.40 2.79 3.09 3.29
TSB Bank 5.34 3.09 3.29 3.45
TSB Special 4.54 2.29 2.49 2.65
Wairarapa Building Society 4.99 3.55 3.49 -
Westpac 4.59 3.09 3.29 3.39
Westpac - Offset 4.59 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 2.29 2.69 2.79
Median 4.55 2.73 2.99 2.80

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