Non-major Bank Panel Discussion pt. 3

Non-major bank representatives discuss industry competition with aggregators' white label products as well as ways they are helping brokers reduce turnaround times.

To watch the 2nd and 1st part of this Panel Discusion, click on the links below:

Mortgage Professional Australia - Non-major bank panel discussion pt. 1
Mortgage Professional Australia - Non-major bank panel discussion pt. 2

Video transcript below:

Robin Christie, Managing Editor, Mortgage Professional Australia Magazine
Robin Christie:
 Do you consider aggregators white label products to be a threat or healthy competition, Jarrod.

Jarrod Cahill, State Manager for VIC/SA, Bankwest
Jarrod Cahill:
 I think it’s healthy competition.  I think it keeps both majors and non-majors looking at their product suite and making sure that we are competing in that landscape, providing the product is suitable to the needs of the consumer, I have no issue at all and from Bankwest perspective we encourage that competition, which keeps us innovating.

Glenn Gibson, Head of Sales and Marketing, AMP Bank
Glenn Gibson:
 I suppose from a non-major when you consider a large percentage of those white labels are funded by a major, you then say well is it healthy competition and partnering with aggregators very happy for them, for our products to fit in with their products as long as there is no channel conflict within the aggregators and channel conflict being BDMs that are there to help the brokers being paid bonuses or being targeted on selling around white label products as opposed to any other product, just don’t to have channel conflict.

Stewart Saunders, National Broker Manager, ME Bank
Stewart Saunders:  
You know we have seen a significant change in the ownership structure of aggregators over the last 3 – 4 years and the white label products that you’ve seen through those aggregators have changed in terms of the market share that you would have seen traditionally as well.  You know I personally think that those market shares can be considered as larger than they should be for a white label product and that does raise some questions, has it changed the playing field, can we compete.

Fons Caminiti, Senior Manager for Broker Distribution, Adelaide Bank
Fons Caminiti:
 Look it’s competition, just another form of it and we accept that fact.  What we want to do at Adelaide Bank though is just keep our eyes on the [ball] and ensure that we keep delivering the message to brokers about our heart and soul and what we stand for.  It’s really important and I cannot stress this enough to our staff and to our business that we get that message across to brokers.  This competition is fine, I don’t know, everyone has said the right things and what have you, that’s just the way it is. What we’ve got to do is just keep focusing on the things that are going to make us better, that will make us a viable alternative to the brokers.

Robin Christie:  We’d just like to ask what the key issues you encounter with applications from brokers and how brokers can work with you as lenders to improve their turnaround speeds and conversion rates.  So I’ll start with you Ray.

Ray Esho, National Sales Manager, ING Direct
Ray Esho:  
Conversions has always been a hot topic in the market.  I think what we have been focusing on internally is having more a targeted approach on rework.  So I think conversion rates can hold, but reworks can increase.  So deals are settling but there are just more touch points to getting them to settle.  So we want to try to be able to improve the turnaround time and the proposition for the broker and the customer, we want to take a targeted approach.  We have I suppose for want of a better word the culprits sending through deals that are more likely to require rework, so we are getting our sales team to go out there and proactively put up those files and address those quality issues.  It’s not systemic, but I think it’s a pocket of the traffic that we receive.

Clive Kirkpatrick, Mortgage Broking General Manager, St. George Banking Group
Clive Kirkpatrick:
 You know as non-lenders as we become more competitive, brokers are using us sometimes for the first time and each lender has some idiosyncrasies in what they require to get a loan in.  So we acknowledge that you got to, as a broker you got to learn a lot about, indepth about a lot of things, so it’s upto us to make it easy, a lot of kind of banged on about around the supporting docs online.  Now the technology with the smart that looks at the product, the customer and tells the broker exactly what documents we need, you scan those documents in and submit with your application.  The assessor sees the document in front of them exactly as it’s been sent in.  A big benefit to that is one brokers tell me is around the tax file numbers.  So you can actually redact the tax file online, they are telling me that saves about 15 minutes per deal, just that piece there.

Jarrod Cahill:  I mean I think there is two sides to this.  The first and foremost from the banking point of view is to make it simplified to lodge deals, constantly reviewing our documentation requirements is critical.  The second element is ensuring that our partnership managers are educating the brokers on what our policies are.  From the broker’s point of view, I think it’s around asking the question upfront.  If they are unsure get on the phone, speak to the partnership manager, make sure that you are comfortable with the transaction before you submit it.

Robin Christie:  Sure, Steven is there anything you are monitoring on paper?

Steven Degetto, Head of Intermediaries, Suncorp Bank
Steven Degetto:
 Yeah look it’s simple things primarily, it’s really using the checklist that we provide, ensuring serviceability test is done and signing the forms in the right area.  I mean those are the absolute basics and I think it’s more so for those grey area transactions where you know where you have humans involved in a credit decision there is that opportunity for them to make a decision one way or the other.  I think it’s important for brokers to remember that through licensing they have got an obligation to make reasonable enquiries about a borrower’s capacity to repay and that’s ultimately the first thing we will need to look at, is can the borrower afford it particularly in an environment we’ve got historically low interest rates and you know those interest rates I don’t think will stay low forever, so it’s really ensuring that that’s considered, but also from us it’s really listening. We’ve got some people that are fantastic that are in own organisations in assessing transaction on their merits, but that’s certainly our aim to do that, continue to do that and get better at it.