The bank had proposed a cut in upfront commissions to 45 basis points from an average of about 60 points, to be implemented on 1 June. Good Returns understands that the bank is no longer intending to impose a deadline but that negotiations on commission are to continue with brokers.
ANZ has been at the forefront of moves by the main banks to cut commission to brokers, arguing that margins on mortgages are now too low to justify the current payments. National Bank and ASB are also reviewing commission although ANZ was the most advanced in its discussions with the industry.
There has been speculation that Westpac was also planning a steep cut. A spokesperson for the bank told Good Returns that there had been no change in policy at the bank although it was continuing to watch the situation.
Some brokers believe that the first newly-negotiated agreement for commission will probably form a model for all the main lenders. However, it appears the focus of discussion is broadening to include the structure of commission payments.
Several broker groups have argued that payments should recognise the quality of business provided to banks by firms.
A spokesman for ANZ said the bank was continuing the consultation process with brokers. “Our approach remains flexible, based on the constructive feedback and discussion we have had during consultation to date.”
