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NAB reclaiming margin

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Australian Broker | 07 May 2009, 03:00 PM Agree 0
The big banks have used the last RBA rate cut to reclaim lost margin explained NAB's regional general manager Matt Lawler at the NAB Broker roundtable
  • Paul Gollan | 07 May 2009, 11:26 PM Agree 0
    If I did not live in this great country and if there was only one or two banks in Austalia I would be saying shame on you instead of good on you. It is great to see a Bank Executive telling it as is rather than tiptoeing around the obvious point that.....


    It is reasonable that if economic circumstances provide the opportunity to increase margins that any business should do so.

    My brokers have families to feed also.

    Paul Gollan
    Australian Mortgage Brokers

  • OzBoy | 08 May 2009, 08:05 AM Agree 0
    they are getting mum and dad home loan holders to pay for the huge losses in their commercial and business area's. While taking back margin can be seen as good business some how I just can't get it to sit with me when I as a tax payer are protecting the banks by guaranteeing their deposits. This is leading to reduced competition which as a broker and Australian I know will hurt everyone over the next 5 years. I am surprised by your comments Paul perhaps there is another agenda in the post?
  • Paul Gollan | 08 May 2009, 10:23 AM Agree 0
    Every single business in a free market economy has the right to price their product or service as they see fit. There have been many subtle reductions in interest rates by the banks over the past 15 years over and above official RBA rates, due in part to "unsustainable" and "irrational" competition from many players no longer in business.
    My agenda is the protection of income for all the hard working mortgage brokers across Australia. The price charged for a mortgage needs to ensure all stakeholders involved in the origination of a mortgage make money. Simple!

    ---This is slightly off topic, but---
    The non-financial contribution made by a broker to a originating a mortgage is often discounted or overlooked by the so-called experts such as Marty North of Fujitsu fame and the media.
    To truly determine the value a mortgage broker brings to the food chain requires a consideration of the amount of capital that a bank DOES NOT HAVE TO EXPEND to bring in mortgages they would otherwise not have written. Bank of Queensland’s snub of the broker market in favour of their franchises is a perfect example of a decision that simply does not get it.
    MAJOR BANK A for example might be originating 40% of all mortgages via their broker channel, but the underlying numbers might show that say 80% of all NEW mortgage customers are being introduced by mortgage brokers. A true comparison of the cost of originating a loan through BROKER V BRANCH would therefore need to address the following question.
    What amount of capital would MAJOR BANK A need to expend, such that NEW mortgage originations were split 50/50 between branches and brokers? Easier said than done of course.
    Many banks are doing a great job of servicing their existing customers but brokers are winning the battle when it comes to originating new customers and this fact is not lost on most banks. This simple analysis of course does not take into account how much extra income they make from all the extra products they flog to these new customers.
  • OzBoy | 08 May 2009, 10:50 AM Agree 0
    Ahh true altruism.
  • Paul Gollan | 08 May 2009, 11:11 AM Agree 0
    I am sure you will agree the current AussieBoy president is going a great job OzBoy.

    Our agenda will be revealed on August 1, 2009 so watch this space as they say Ozboy.
  • Jim | 08 May 2009, 12:37 PM Agree 0
    Agree, it's good credibility for the MFAA and its membetrs to have AussieBoy as its Pres and Commanding Chief however he/they need to lobby much harder for us brokers. How long is he Pres for?
  • P Edwards | 08 May 2009, 08:55 PM Agree 0
    Mate, come on, he heads up my aggregator group. He is a great CEO, and given all the negatives thrown at the MFAA, I want him top of his game on a daily basis for me (his member broker) rather than dealing with a bunch of negative digruntled brokers that whing if you sneeze in their direction and believe everyone in the world is out to screw them.Stay put Paul and let Aussie save your whining souls.
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