subscribe to our newsletter
Big four ‘own’ 40 per cent of brokers

Big four ‘own’ 40 per cent of brokers

Australia’s mutual lenders have hinted at the need for a national mortgage broker register after estimating 40 per cent of loan writers are owned by the major banks.

The Customer Owned Banking Association said yesterday that the transparency of a financial adviser register should be extended to retail banking and mortgage broking.

“The new financial adviser register will boost transparency and help consumers distinguish genuinely independent advisers from major bank shopfronts,” COBA said.

Commencing at the end of next month, the register will disclose the firm that controls the licensee who authorises the adviser.

COBA CEO Mark Degotardi said the same principles of transparency and consumer empowerment should apply to sub-brands in retail banking and mortgage broking.

“Major banks use sub-brands to lure consumers who don’t want to bank with a major bank,” Mr Degotardi said.

“Major banks own, totally or substantially, broking groups comprising an estimated 40 per cent of mortgage brokers,” he said. “Consumers deserve effective disclosure about who they’re really dealing with.”

Mr Degotardi said ASIC has warned about significant and continuing consolidation in the funds management industry and the challenges of vertical integration in banking and along the product distribution chain.

Similar observations were made in the final report of the Financial System Inquiry.

“Transparency about ownership will help empower consumers to avoid dealing with entities that have a record of acting against the interests of consumers,” he said.

“The most effective way to deter such conduct is to ensure that the entity can’t hide behind subsidiaries and sub-brands.”

 

Big four ‘own’ 40 per cent of brokers
mortgagebusiness

Latest News

The chairman of the Australian Securities and Investments Commission has said that the corporate regulator will move forward with more “co...

The Senate Standing Committee on Economics is set to review short-term credit providers, payday lenders, consumer lease providers, “buy no...

Weaknesses in the government’s proposed open banking implementation plan could spark a “scaremongering” campaign, a fintech has warned...

FROM THE WEB

podcast

LATEST PODCAST: Emotional intelligence and its role in managerial structure

Is enough being done to ensure responsible lending?