Morning Briefing: Industry responds to Government's call for transparency on interest rates

NAB and the Australian Bankers’ Association have responded to the Federal Government's call to discuss how the lenders set interest rates... Broking franchise expands service portfolio...

Industry responds to Government's call for transparency on interest rates
The Federal Government has invited banks to present to the House of Representatives Standing Committee on Economics on their decisions behind setting interest rates.

NAB CEO Andrew Thorburn said in a statement, "I will accept the invitation to attend the Committee and discuss the way we balance the needs of all stakeholders, including borrowers, depositors, investors and shareholders. 

We believe our key responsibility is to help people with important financial decisions and to build a stronger economy. We are committed to helping people buy a home, save for retirement, start and grow a business and in doing so create more jobs and opportunity. 

In any business, big or small – indeed in government and organisations of different shapes and sizes – there is always a balance needed in all major decisions," he said, explaining  the needs of stakeholders had to be carefully balanced, to ensure their ongoing support.  

"We have been paying more to both depositors and investors over the past six months and we set a rate for mortgage customers that reflected the balance between all our stakeholders. If we don't get this right, it is inevitable we will lose business, and become a less competitive bank."

The Australian Bankers’ Association also responded with ABA chief executive Steven Münchenberg saying banks have explained repeatedly why the Reserve Bank does not set interest rates.

“The Federal Government is entitled to call the banks before a parliamentary committee, however no other businesses are required to justify their commercial pricing decisions in this way.” 

“Since the start of the global financial crisis, over eight years ago, the Reserve Bank’s cash rate has not mirrored the actual funding costs of banks.”

“We are confident banks can explain why the interest rates they set for borrowers are determined largely by the costs of funds and the pressures of a highly competitive market, not the Reserve Bank cash rate,” he said. 

MoneyQuest expands service portfolio
Broking franchise, MoneyQuest has announced it has expanded its service portfolio to include buyer advocacy, vendor advocacy and property management.

The new services are designed to give clients a seamless experience and results in their property buying experience, says managing director and finance industry leader, Michael Russell. 

"We already know that the property market can be a daunting environment for buyers, sellers and investors. And we are confident that MoneyQuest is now well placed to help all parties overcome their anxiety and achieve greater success,’ said Russell.

To make this expansion possible, MoneyQuest has entered into a formal partnership with leading full-service property agency, National Property Buyers.

National Property Buyers director and state manager, Antony Bucello says, "We act exclusively for our clients at all times, either as buyer’s agents, vendor’s agents or property managers. Mortgage brokers regularly recommend our property management service to investor clients looking for a professional service insulated from company-owned real estate mortgage broking businesses."

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