National Australia Bank (NAB) has put its full support behind trail and upfront commissions, acknowledging that the current structures are a fair way in which brokers are remunerated.
Speaking at yesterday’s MPA Major Bank Roundtable, Steve Kane, general manager of broker distribution at NAB said the sheer success of the broker channel taking up more market share had led to added regulatory oversight in the industry.
“We welcome that regulatory oversight as it legitimises even further the role that brokers play in the marketplace,” he said.
“We think that the services [brokers] provide, the information, the way in which they interact with the customers is evidenced by customers voting with their feet and turning up to brokers in ever increasing numbers.”
Additional oversight by the Australian Securities & Investments Commission (ASIC) was an opportunity to improve the way in which customers interact with brokers and other intermediaries, Kane said.
“What is really apparent though is that we need to ensure any remuneration is absolutely visible as to who’s paying, who’s receiving the money, what they’re receiving the money for, and how that is going to be accounted for.”
Transparency and clarity for the end customer around any remuneration structures are vitally important, he said.
“Even if it’s only a suspicion that there’s something going on, the intention really needs to be to make sure all communication around remuneration is very clear, very transparent because it just leads to a perception that there may be something going on.”
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