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Cummings derides 'ignorant and apathetic' competitors

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Australian Broker | 14 Feb 2012, 08:00 AM Agree 0
The Commonwealth Bank has labelled competitors that do not segment their accredited brokers as "ignorant and apathetic" when it comes to their broker customers' clients
  • ChrisC | 14 Feb 2012, 09:42 AM Agree 0
    I am by no means any less qualified or professional in my dealings than those brokers the CBA has elected to segment.
  • Country Broker | 14 Feb 2012, 09:43 AM Agree 0
    Maybe aggregators and brokers should segment all the lenders on their lending panels. If we did that where would we rank the CBA ?? Despite these comments and the lack of trailers paybale in the first year, they are worth dealing with, their call centres are helpful and the website is good, products are OK especialy for a low deposit application.
  • Paul Gollan | 14 Feb 2012, 09:56 AM Agree 0
    Segmentation alienates brokers, not just the ones that get segmented out the back door. EVERY broker should receive at least a minimum acceptable service standard if they hold an accreditation with a lender. ANZ does not segment and it does not seem to be affecting their volumes or market share. Disclaimer: The author owns shares in ANZ & NAB.
  • Brad Q | 14 Feb 2012, 10:25 AM Agree 0
    If I was a diamond broker (and I'm not) I would be worried with myself, that I send too much business to CBA. They aren't always the most appropriate lender ( especially for an offset account).
  • Trevor | 14 Feb 2012, 10:27 AM Agree 0
    When lenders start to understand that we as brokers survive by offering our clients the best deal available then they will get more business if they offer the best deal. It is an insult to clients and brokers when a lender is prepared to provide a better service for volume. I have been a party to preferred service but that party did not receive one deal extra unless they had the best deal on offer amongst our panel of lenders. If lenders half understood the situation then they would be providing equally good service to the lower volume brokers in a hope that they may gain more volume when speed of service is more important than the deal but that should be in the minority of circumstances. That is why a growing number of clients prefer to see a broker to get a honest and best deal. The loyalty is to the client not the lender as it should be. Lenders and brokers need each other but the client produces the income and each client whether borrwing $50k or $500k deserves the best available loan and service. Anything less than this is shortsighted. In fact I would expect that a broker would have some explaining to ASIC if one lender was favoured if it could not be proved that the best deal was offered that corresponds with the clients requirements.
  • Rach | 14 Feb 2012, 10:47 AM Agree 0
    Segmenting is pointless and in my humble opinion ASIC and ACCC should have a problem with it - but, oh that's right, they have no clue what our role actually involves !
  • Lawry | 14 Feb 2012, 12:05 PM Agree 0
    I can count on 1 hand, the number of deals I have given to CBA in the past 12 months due to competative issues.

  • Ray | 14 Feb 2012, 01:34 PM Agree 0
    Spot on, Trevor! Where is the duty of care to the client if the broker has to "push" loans which were not as good as other loans available to the broker and his client. I will not provide loans to my clients purely on the basis of volume requirements. I would prefer to receive less commission (if I had to), but still provide the best loan product for the client's circumstances. I think the high moral ground is inhabited by the majority of brokers, and there's no room for those who do not put the client first.
  • Rob | 14 Feb 2012, 02:36 PM Agree 0
    I have always offered my clients the best deal available from my panel, its rare a CBA product is included. Clients needs come first. The result is a very low attrition rate.
  • James Green | 14 Feb 2012, 03:28 PM Agree 0
    CBA has probably the best segmentation program in the market. I personally have seen the benefits of the CBA Diamond service offering and don’t know what we would do without it.
    Segmentation is important because low volume and inexperienced brokers cause blockages. Our experienced team can’t afford to have an urgent buyer/loan held up by these blockages.
  • vic S | 14 Feb 2012, 03:48 PM Agree 0
    I think banks should have segmentation among their own employees and not brokers, because they have only one product to sell and how best they sell this, should drive their grade. Rach above rightly said that ASIC should have some reasoning to do with brokers who take most loans to one broker?? Is that lander really the most competitive? If yes, then lander doesn't have to have segmentation as every broker will love it. If that's not competitive, is broker doing the right job by taking clients to that bank just because broker is terated differently???
  • Tim | 14 Feb 2012, 03:54 PM Agree 0
    Trevor has got it right. The brokers who have acheived Diamond status with CBA must surely have to question themselves on whether they are offering their clients the best deal. Sure CBA have some niches that they do very well but these brokers could not be just writing loans in these niches only. James Green you are correct to say blockages cause delays but what the lenders in conjunction with the aggregators should be doing is upskilling these people causing the blockages. If they don't improve their performance then penalise them. Like learning to drive we all had to learn how to do mortgage broking. Learner drivers are not told to use another road, they receive instructions till they become competent. If after a certain period of time they are still not competent then they don't get their license or if they already have their license and are performing poorly they can lose their license. Lenders continually complain about poor presentation of loans by brokers. Education not segmentation is the key here.
  • PC | 14 Feb 2012, 04:29 PM Agree 0
    James Green please explain how a low volume broker causes blockage? I would suggest that if you are Diamond then you probably do not offer the full range of Banks and Non Bank products, therefore you are not looking after your Clients needs properly.
  • PeterT | 14 Feb 2012, 04:48 PM Agree 0
    I write $2M - $4M per month as a single broker. My business income is over $250k per annum (including trail), so I figure I'm fairly successful. Last week the new BoM BDM told me that if I can send them $1M per month I'd be a 'flame' broker and get better service and order my own valuations.
    She's effectively asked me to become a dedicated BoM broker who does a few other lenders on the side.
    Segmentation by volume is complete rubbish and detracts from the broker proposition. I work for the client, not the bank.
  • Jeff Purcell | 14 Feb 2012, 06:19 PM Agree 0
    I have missed something here. Are not the Clients/Customers our number one priority. It is encumbent on allparties (Broker/Lender) to work together to ensure maximum client satisfaction for all clients. Those who segment their Brokers do so at their own peril. They are clearly stating if you use this broker then we will perform regardless of whether the Broker has or has not disclosed better products and regardless what is appropriate for the Client/Customer.
    This is blatent Client/Customer discrimination.
    NAB have got it right they unashamebly state all customers introduced will be treated fairly and impartially and not discriminated against.
    At the end of the day it is obviously system constraints that has given birth to segmentation. Those who don't segment and don't discriminate have overcome this and are reaping the rewards and will continue to do so.
    If we learn one thing in our short stay on this planet, it is not to discriminate in any way what so ever.
  • Brad Q | 14 Feb 2012, 08:53 PM Agree 0
    @ James Green - So you intentionaly get your customers a quick approval... not the best loan for the customers needs? I rarely come across a customer that is urgent and MUSt have approval within a day or 2... on most purchases you have 2 -3 weeks for a loan approval... whats the hurry?
  • Donut | 15 Feb 2012, 09:49 AM Agree 0
    I agree with Jeff Purcell. We are all customers to the lenders and our customers have all the same needs.
  • A Broker | 15 Feb 2012, 12:03 PM Agree 0
    As one of the Mass Market (read: pleb) brokers, I find the service I get from CBA is actually very good, and is noticeably better than the service from some other lenders. I don't believe in recommending lenders based on whether or not I'm going to get nicely segmented; I recommend lenders based on the best fit for the client. Sometimes CBA comes up as an option, other times they don't. Of course, if their service to us Mass Market Brokers goes down the pan, I'd have no hesitation in striking them off my menu, or at least give my clients a warning about any perceived service issues prior to taking an application.
  • honesty is a good policy | 23 Feb 2012, 11:27 PM Agree 0
    Segmentation just confirms the major players own the distribution channels and the "diamond" "flame" or whatever grandious banner confirms they are contracted loan writers and not independent to lender players in the market place.
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