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Brokers divided on commercial lending legislation

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Australian Broker | 17 Jan 2013, 10:00 AM Agree 0
New legislation seeking to further regulate commercial lending is still in its infancy - but opinions are already sharply divided
  • Peter White - FBAA President | 17 Jan 2013, 11:23 AM Agree 0
    People this regulation is in draft form and it is important not to jump the gun on this and wind up with a mis-fire. The FBAA has been dealing closely with Treasury on this matter for some 2.5yrs now and is the sole industry voice with any practical finance broking experience whatsoever in commercial and or business lending from that time. I myself wrote my first business loan around 1981 and is an area of lending specialisation of mine to this day.
    Firstly, if you have ever been involved in full doc business or commercial lending as a broker who acts in a clear and transparent manner then you have little to worry about and little change.
    Secondly access to business/commercial credit WILL NOT become harder to access and any impact is for loans under $2m and only in certain circumstances.
    Thirdly the work required by brokers under this draft regime will not place any additional 'paperwork' burden on broker who today already is transparent and thorough in their submissions for credit in this sector.
    Lastly the biggest issue is the permit regime being proposed and is something the FBAA solely is challenging Government on as we speak.
    More once known and appropriate to detail further.
    So relax, take a breath, have a coffee and lets keep writing more business as skilled professionals in this sector.
  • Country Broker | 17 Jan 2013, 11:40 AM Agree 0
    oh dear , Peter White , how do you know what the MFAA are doing or not doing about this and yet I agree with you .

    This legistation is not dangerous to brokers with the experience and the intelligence to be transparent and do a professional job .

    What is needed is for the aggregartors and other industry commentators to stop advising brokers to look at expanding into Commercial when they are not experienced or qualified to do so. Please identify the Brokers with the experience and support them by setting up referral networks within the industry so we can ensure a professional job every time and let the home loan brokers gain the experience.
  • Please Explain | 17 Jan 2013, 11:46 AM Agree 0
    I have taken the paragraph below directly from the ASIC website the part i like the best is "for example, the obligations to act efficiently, honestly or fairly or to have adequate resources"

    What a complete joke.

    The other general conduct obligations in section 47 of the Credit Act will not apply to persons engaging in small business credit activities (for example, the obligations to act efficiently, honestly or fairly or to have adequate resources)
  • Peter White - FBAA President | 17 Jan 2013, 12:28 PM Agree 0
    Dear Country Broker - thanks for the first sign of support from you .... but I made no mention of the MFAA ..... albeit they sit with us on the same committees with government and regulators. This area of business and commercial lending together with Motor Finance (under POS ... which the disucssion paper on the same was released by Treasury yesterday) are widely known within government/regulators as specialities of mine hence our unique closeness to this. But I prefer to wait to make informed commentary, and not early guesses which history has shown to be in error.
  • Lyn Turner | 17 Jan 2013, 01:03 PM Agree 0
    Contrary to current boasts, there has only been one conscientious representative of a broker organisation attending Treasury Consultation Group meetings. However, both major broking organisations' top leadership have provided very little support to other industry sector organisations who have been working tirelessly to stem Minister Bill Shorten's anti-finance business crusade.
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