has joined a chorus of criticism of APRA
following comments by chair Wayne Byres
Byres Wednesday warned lenders to manage their home loan flows through brokers with “appropriate care”, claiming that broker loans were at greater risk of default. But FBAA
chief Peter White
claimed any greater default numbers were due to the channel's dominance rather than riskier practices.
“It is obvious that whichever group writes the most business will always have the highest number of defaults as it’s simply a matter of volume, and not the lack of quality transactions,” White said.
White called for APRA
to conduct a fair comparison of the broker channel with proprietary channels.
“We want the regulator to separately review bank branch originated loans and look at their issues, and then compare it using the same analysis of broker originated loans, and then draw conclusions. Anything else is not comparable, nor is it a fair assessment of any potential issues.”
White pointed to the guidelines set out by the NCCP, saying brokers adhered to high professional standards.
“If the regulator starts pointing the finger at brokers, it has to be said there are three more fingers pointing back at the banks,” White said.