Bank ownership of aggregators or aggregator white label products does not create a conflict of interest for mortgage brokers, according to Advantedge general manager of distribution, Brett Halliwell
Halliwell has spoken out after Suncorp urged the government in its response to the Final Report of the Financial System Inquiry to act on recommendations to improve transparency in the mortgage broking industry, as major banks are “increasingly taking control of the broker-originated home loan”.
Halliwell, who runs white label distribution for Advantedge, which is part of the NAB Group, says ownership structures would play very little on the broker’s mind, as the role of an aggregator is a background role in the broker’s business.
“From the aggregation side, if you look at what an aggregator offers, it’s really about providing member services to the broker – that involves IT systems, compliance, training and development. It also involves access to a panel,” he told Australian Broker
“Every aggregator in the country has a lender panel of 20 or more lenders so if you put all of those streams together, consumers go to brokers because of the advice they give. The brokers are incentivised to look after their customers. The aggregators are very much sitting in the background, providing services to the brokers.”
Whilst Advantedge is very open and transparent about its affiliation with NAB, Halliwell says neither brokers nor consumers really care about who owns who.
“Brokers will choose us if we demonstrate what they need, and that is usually about the right price for the customer, the right product, the right service levels, the relationships where they feel comfortable dealing with the lender,” he told Australian Broker
“I don’t think any brokers would really think that ‘I’m with Advantedge or NAB’, they are thinking ‘I’m working for my customers under my own brand’.
“When it comes to consumers, in my experience, what is top of mind is that they will get service from a broker who is focussed on meeting their needs. The core part of the broker proposition is that they do have access to a broad panel and the industry stats show that they do use that panel very broadly. There is a wide utilisation of different lenders across all of the aggregation panels.
“Mortgage brokers have been very successful and gained 50% market share of all of the mortgage sales made in the country because they are really good at what they do.”
Halliwell says Advantedge does not offer kickbacks or incentives to brokers under any of the NAB aggregators for writing one of its white label products anyway.
“We offer the same services to brokers and we don’t differentiate in terms of having different classes or categories. Our philosophy is about delivering service to all brokers equally.”
In fact, Halliwell says Advantedge is usually three, four or five on the panel and NAB Broker usually sits somewhere between one and four.