Trending Financial News 13 August
Aussie John wants his home loans back
“Aussie” John Symond, the founder of non-bank lender Aussie Home Loans has suggested he wants to buy back part or all of the business he started in 1992.
Aussie Home Loans (now owned by Commonwealth Bank) was one of a small group of non-bank home loan providers who shook up the big bank dominated mortgage market in Australia during the 1990’s. Mr Symond told The Australian that:
“I want to make sure the company continues to do well, I’m just keeping watch.”
Mr Symond, who is still Aussie’s chairman, said CBA was likely to sell Aussie within two years.
Lenders have passed on most of the RBA rate cuts
The Reserve Bank reported yesterday that its two interest rate cuts in June and July have lowered borrowing costs for businesses and consumers and especially new mortgage customers.
Assistant RBA governor Christopher Kent said the average outstanding variable-rate housing loan rate fell by 0.23 percentage points in June after the RBA cut rates by 0.25 percentage points. Dr Kent said costs had fallen by about the same amount in July after another 0.25 percentage point cut from the RBA.
Dr Kent says new loan customers and refinancers have particularly benefited from recent rate cuts because of discounting by lenders.
CommBank staff cop an earful from unhappy customers
Commonwealth Bank staff absenteeism has hit a new ten-year high and the bank’s own employee engagement index has dived to its lowest reading ever as angry customers take their toll on staff morale.
Finance Sector Union national secretary Julia Angrisano said staff had felt the brunt of customer complaints.
“CBA customers have rightly expressed anger and dismay at the actions of the bank.
Commbank chief Matt Comyn said incidents of aggression against the bank’s staff were at an all-time high.
“Of course I am very sorry for the situation that we have put them in.”
187 Commonwealth Bank workers were dismissed for serious misconduct in the year to June 2019, the Herald Sun reported. Commbank has denied it wants to shed up to 10,000 jobs from its workforce of 48,300 people.
Bendigo’s online brands going UP
Bendigo and Adelaide Bank’s new digital banking brands are attracting new customers, the bank reported yesterday. Bendigo’s net profit fell 13 per cent to $379 million over the year to June 2019, weighed down by compensation payments to wealth clients and redundancy costs but its digital banking brand “Up” is mostly responsible for the number of new customers (rising) by almost two-thirds for the full year.
Bendigo’s online home loan provider, Tic:Toc, reported “$3 billion in assessed applications since launch” in July 2017 and a big increase in approval volumes over the financial year just ended.
How do mortgage brokers get paid?
Mortgage brokers receive up-front payments and trail commissions annually from lenders while a loan they sell is active.
The Banking Royal Commissioner Kenneth Hayne recommended broking commissions be scrapped and replaced with direct fees, however the broking sector successfully lobbied against the move.
The government agreed to review the broking market in three years. Brokers account for more than 50 per cent of new home loans written in Australia.