View more on these topics

NZ brokers may see commission halved

Mortgage brokers in New Zealand are facing a crisis as major lenders consider halving commission.

The New Zealand Mortgage Brokers Association met representatives of the four major NZ banks last week for talks to stave off the threat caused by tightening margins.

Lenders are thought to be preparing to cut commission within six weeks, with suggestions that broker remuneration could be halved. This means brokers will be forced towards fee-charging models.

Banks stopped paying annual trail commission last year, leaving brokers to survive on up-front commission, generally set about 0.8 per cent of the value of a loan.

In contrast, Moneyfacts’ research last month showed that commission in the UK has been growing steadily in the prime market over the past few years, despite many lenders complaining of tightening margins.

NZMBA chairman Geoff Bawden has been reported as saying: “In some respects, charging a fee in the marketplace would be the ultimate acceptance of the value brokers add but I do not think this market is in a position to accept that.”

Recommended

Advisers still unaware of new CI definitions

Nearly half of advisers are unaware that protection providers’ critical illness cover definitions are changing at the end of April.In a survey conducted by The Exchange on behalf of Royal Liver, 48 per cent of advisers questioned were unaware that CI cover definitions are changing.Out of 578 respondents, 86 per cent did not know how […]

Risk Placement claims big time savings online

Risk Placement Services says it has set aggressive distribution targets for this year and extended its service to advisers through three networks, including Sesame.The impaired-life specialist will now offer its services to Sesame, Burns Anderson and Covernet advisers which have a combined adviser base of over 8,000.RPS recently announced it would be offering its services […]

The Investment Clock: Keep calm and Macron!

Trevor Greetham, Head of Multi Asset In a marked contrast to the surge in risk sentiment that followed President Trump’s election in November, markets greeted Emmanuel Macron’s victory in the French presidential election with satisfaction and relief, rather than euphoria. After rallying strongly on opinion polls that accurately predicted the outcome, the euro held onto […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment