Non-bank urges brokers to avoid big banks

by Rebecca Pike07 Feb 2019

A non-bank lender has called upon mortgage brokers to stop sending business to the big four banks in response to the Royal Commission.

Firstmac, which manages approximately $10billion in mortgages, said the big banks had prompted the Royal Commissions through a series of scandals and then successful deflected blame onto mortgage brokers.

Managing director Kim Cannon said, “The big banks saved themselves by brazenly throwing mortgage brokers under the bus.

“The only reasonable response from mortgage brokers is to protect themselves by diversifying their businesses so they aren’t so reliant on the banks.”

Cannon said it was unfair that tens of thousands of mortgage brokers could suffer severe financial stress as a result of changes recommended by the Royal Commission while shares in the big banks had rallied nearly 5% in a day.

“Australians have nothing against mortgage brokers and it wasn’t the brokers that provoked this Royal Commission yet they are the biggest losers from the commission’s recommendations,” Cannon said.

“We are very disappointed that mortgage brokers have been made into fall guys for the banks and we support them 100%. We will work with brokers to ensure that their businesses remain viable despite this very cruel and unfair blow.

“We have a long history of being more innovative than the banks so watch this space.”

Cannon said that the government must be careful to ensure that broking services remained affordable for the general public.

“It is very important that any changes to the commission structure for brokers don’t put their services out of reach of ordinary Australians,” Cannon said.

“Mortgage broking advice must remain a service that everyone can afford, not just the rich.”