The decision of some banks to leave the broker channel during the GFC has left many cautious about dealing with them again, despite reassurances the banks are here to stay.
Bank announced at last week’s operational briefing that the bank was looking to boost its third party partnerships – but brokers aren’t quick to forget the bank left the mortgage industry during tough times in 2007.
Comments on the Australian Broker forum reflect broker wariness around the bank’s re-entrance into the industry, and a South Australian Broker says the bank needs to address the issue head on.
“I think there’s a theory that it’s negative to talk about stuff that didn’t work out,” said the broker, who did not want to be named. “I know having worked in one of the banks as an executive a lot of them think they just need to talk positive and don’t go into the negative, just talk about new visions and a new way forward.”
But brokers need solid reassurances, he says, especially as most broker businesses are built on referrals and gaining client trust.
“I keep thinking as soon as they going got tough they bailed out on the client – not so much that they bailed out of our industry but just that they sort of left clients high and dry.
“They tell me that can’t possibly happen again because their funding isn’t the US securitised model anymore, it’s now all onshore… but it just gives me the feeling that the minute something went wrong before your first reaction was to save yourself and to hell with everybody else.”
Through a good relationship with his BDM the broker says he has managed to get some reassurances from the bank, but he says Macquarie
needs to be more open with brokers and stop pretending the 2007 events didn't happen.
"I know they don’t want to talk about it and they want to move forward but you’ve really got to explain the past to people so they don’t think the future's going to be the same."
Similar problems exist with broker perceptions of Bank of Queensland, he says, after the regional bank left the broker channel in 2004.
While Bank of Queensland has clearly stated that it’s back with the broker channel for the long-haul, the bank still has a long way to go before perceptions change, says the SA broker, and this is made even more difficult by the state-based handle and lack of support staff in other states.
Bank of Queensland head of third party distribution Brad Rockwell, acknowledges re-entering the market was never going to be an easy road.
“We can’t change decisions made in the past but what we can control is the quality of the offering we provide to the broker market now and into the future,” says Rockwell.
“We have appetite to grow and our main focus in 2014 is on getting our offering right – our success in this market will be determined by what we do from her on.”
Rockwell says the bank has listened to feedback from brokers that more on-the-ground support is needed, and has therefore recruited new BDMs in NSW, Victoria and WA.
“Given at least half of all mortgages originate from brokers, no bank can afford to not be highly committed to the broker market.”
Bank declined to comment.