Powered by MOMENTUM MEDIA
subscribe to our newsletter

Convergence to lift broker disclosure: CBA

The convergence of mortgage broking and financial planning will create a greater need for brokers to disclose commissions, according to the Commonwealth Bank of Australia.

While the FOFA-regulated planning space has a very different commission structure to mortgage broking, the convergence of both professions will naturally create the need for brokers to be more transparent with clients, CBA head of mortgages Clive Van Horen told Mortgage Business.

“I do think there will be more obligations on lenders and brokers to disclose more transparently than they do today, and I think personally that is a good thing,” Mr Van Horen said.

“Especially because you have more integration across financial advice and mortgage advice today, so many broking groups or branded groups are explicitly about providing customers with that integrated offering,” he said.

“So it is quite hard to have two different sets of standards with disclosure or commission arrangements.”

Advertisement
Advertisement

Brokers are currently subject to disclosure obligations which Mr Van Horen believes will only increase over time.

“I think directionally those will only get more, not less,” he said. “I think it is only right that customers know what the financial incentives are for their advisers to do business with them.”

According to the 2014 Financial Services Convergence Report by Mortgage Business’ sister title ifa, 72.1 per cent of surveyed respondents believed convergence was feasible, while 44 per cent were confident that most advisers will offer mortgage and debt advice within the next five years.

Of the 289 financial services providers surveyed by ifa, 79.1 per cent think it is a true proposition to be able to offer solutions – including mortgages – for all their clients’ financial needs.

Financial services lawyer and Rockwell Olivier managing partner Peter Bobbin believes FOFA is driving the convergence between broking and planning.

PROMOTED CONTENT


“Advisers have had to sit down and justify their fees,” he said.

“Pulling in the other services is an important part of that.”

 

Convergence to lift broker disclosure: CBA
mortgagebusiness

Latest News

Citi is to exit its consumer business, including mortgages, loans, retail banking and credit card operations, in Australia and 12 other ...

The major bank’s CEO has reiterated that responsible lending changes could simplify the lender’s processes and improve mortgage approv...

The non-major has reported growth in housing lending as well as a rise in home loan settlements via the broker channel. ...

FROM THE WEB

Join a group of highly informed brokers.

Broker Pulse, a community-driven knowledge base of lender performance Reveal exactly which lenders are making life easiest for brokers and their clients by taking this monthly survey and joining a group of highly informed brokers who leverage these insights every month.

JOIN NOW
podcast

LATEST PODCAST: Tackling the home deposit challenge

Do you expect to see strong uptake of the HomeBuilder scheme?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.