Banks break up with brokers
The four major banks are moving away from mortgage brokers to generate sales and are instead using the lure of fixed interest loans and greater mortgage discounts through their own branch networks.
This move comes after the latest quarterly figures released by the Market Intelligence Strategy Centre (MISC) reveal the big four banks are financing fewer than 60 per cent of loans sold by mortgage brokers.
The MISC data shows the big four banks are behind 80 per cent of all mortgages sold in Australia, proving them substantially underweight on the mortgage-broker channel.
The MISC figures showed a decrease in the loans sold by mortgage brokers but financed by the major banks.
This figure fell from 64% in the June quarter last year to 59.8% in the same period this year.
This is the biggest drop in the major banks financing of the mortgage broker channel since the September quarter in 2007.
The MISC figures also reflect regional lenders such as Bank of Queensland and Bendigo and Adelaide Bank becoming more active in selling loans through the broker channel.
A slowdown in the domestic economy and weakening jobs growth have spurred the Reserve Bank of Australia to cut the cash rate by 25 basis points this month to 3.25 per cent.
ANZ was the last of the big four banks to pass on a fraction of the RBA rate cut, trimming variable mortgage rates by just 20 basis points. It blamed competition for deposits for the need to hold on to a margin.
Commonwealth Bank and National Australia Bank reduced their standard mortgage rates by 20 basis points to 6.6 per cent and 6.58 per cent, respectively. Westpac lowered its rate by 18 basis points to 6.69 per cent.
Among the second-tier banks, Bank of Queensland cut its standard variable rate by 20 basis points to 6.71 per cent, while the Newcastle-based Greater Building Society lowered its rate by 15 basis points to 6.25 per cent.