A major bank has today announced new commission changes for the broker market.
Westpac has told Australian Broker that the bank will put in place commission incentives that could see brokers earn up to 65bps of upfront commission. Westpac general manager mortgage distribution Tony MacRae said the bank would be making recent trial changes to its commission structure permanent, as well as introducing new incentives.
"You'd be aware that we've had a 10bp volume incentive in place for the last six months. We're going to put that permanently in place, but on top of that we're going to offer brokers and additional five points if they meet conversion hurdles," MacRae said.
MacRae said the changes would take effect from the 1st of March, and that the volume targets were ones many brokers had already attained.
"We're looking at a 70% conversion target, which we see a good proportion of our broker and aggregator partners already achieve, but we also want to ensure we lift that by putting this incentive in place," he said.
As the market grows more competitive, MacRae said banks are working harder to strengthen their relationship with the third-party channel/
"Competition continues to be very strong for customers' mortgage business, and especially among brokers, but this is about showing Westpac's commitment to the broker market, and that we're in it for the long haul and recognise the valuable part that brokers play in introducing new-to-bank customers and all-of-wallet customers."
MacRae said the bank would announce several other initiatives as to be detailed tomorrow in Australian Broker.