Majors allowed to jointly arrange aggregator assurance reviews

The Australian Competition and Consumer Commission (ACCC) granted authorisation with conditions to the Commonwealth Bank (CBA), Westpac, ANZ, NAB and Macquarie Bank to develop and implement an assurance acquisition program for mortgage aggregators.

Granted on 11 April 2024, the authorised conduct allows lenders to jointly arrange, and share the cost of, aggregator assurance reviews, the ACCC has confirmed.

Lenders previously would individually arrange for assurance reviews of compliance system of each aggregator they would deal with.

According to the ACCC, lenders collectively acquiring assurance services in relation to aggregators are “likely to result in efficiencies and cost savings for both mortgage lenders and aggregators”.

Under the programs, participating aggregators are subject to fewer assurance reviews, thus reducing the duplication of resources and information that was required of both aggregators and lenders for aggregators to separately demonstrate that they are meeting assurance standards.

In addition, the ACCC said the joint acquiring of assurance reviews to improve the standard of assurance reviews due to the standard of assurance reviews undertaken collectively is “likely to be higher than most lenders would undertake if they continued to separately conduct assurance reviews”.

The granted authorisation will be for five years, expiring on 3 May 2029, the regulator said.

Meanwhile, the ACCC has allowed for collective bargaining by small Australian mutuals.

The regulator did not object to the collective bargaining notification CB10000486 lodged by the Customer Owned Banking Association (COBA).

COBA lodged the notification on behalf of a subset of members known as Small Australian Mutuals (SAM) and the Mutual Bank to enable Shared Services Partners Pty Ltd (SSP) to negotiate with potential providers of a loan serviceability calculator for SAM members.

The ACCC said that it is satisfied that the collective negotiations are likely to result in public benefits in the form of reduced overall transaction costs for SAM and the provider of the relevant product.

The regulator also did not object to the negotiation of more efficient terms and conditions.

“There is likely to be minimal, if any, public detriment,” the ACCC said.

The ACCC decided to allow the notification to remain in force for a period of 10 years, as requested by COBA.

The ACCC recently welcomed merger rule changes by the Australian government that will see mergers approved within 30 working days and follow a single decision-making process.

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