36% of brokers expect to decrease CBA use

The latest Broker Daily survey – Which banks back brokers – has found that 36 per cent of all brokers surveyed expect to decrease their use or recommendations of the Commonwealth Bank of Australia (CBA) in the foreseeable future.

Broker Daily commissioned Broker Pulse, the lending insights division of Agile Market Intelligence, to conduct an online survey of Australian mortgage and finance brokers.

Participants were invited through Broker Daily’s editorial and email channels between 4 and 6 September 2024. The survey received a total of 679 completed submissions. This provides a strong sample for a study of this nature with a confidence interval of ±3.76 per cent at a 95 per cent confidence level.

Of the brokers already using CBA, 48 per cent said they would decrease recommending or using the bank.

Additionally, 23 per cent of all respondents said they would stop recommending or using CBA entirely, while 30 per cent of brokers currently using the lender said the same.

The findings suggest that this is a result of the reputational damage that the major bank has done to the third-party channel.

The majority of brokers (89 per cent) believed that CBA has had a negative impact on the mortgage broking industry in the eyes of the Australian public, with 69 per cent citing a “significant negative impact” and 20 per cent citing a “negative impact”.

This comes as the head of CBA, Matt Comyn, said during the standing committee on economics inquiry of the major banks in late August that broker remuneration does not face the same level of scrutiny from regulators such as ASIC as bankers.

“We have 1,800 home lenders, and there are approximately 20,000 mortgage brokers,” Comyn said.

“It simply cannot be that there is an undue level of concern over what we are talking about, a few hundred lenders, compared to the 20,000 mortgage brokers that don’t have any of the controls in this regard.”

Westpac CEO Peter King agreed with his counterpart, saying that banks have been operating “at a different” level to brokers since the royal commission.

Despite these findings, anonymous testimonies collected from brokers through the survey indicated that while they would like to decrease recommending the lender, they are still bound by best interests duty (BID) regulations.

One broker said: “We are still subject to BID – for some clients the best option for them under policy may still be CBA. I would prefer to write less CBA [loans] – but my clients interests come first. If all aspects were equal (i.e. borrowing capacity, price, and policy) – I would be likely to recommend other lenders first.”

Tune in to the upcoming Broker Daily Uncut podcast on Monday (9 September) where hosts Phillip Tarrant and Alex Whitlock will be discussing the full results of the survey as they emerge and what implications the results have for the wider broking community.

[RELATED: Big bank bosses target broker commissions]

Adrian Suljanovic is a journalist at Broker Daily with more than two years experience reporting on all facets of the third party distribution channel.

Adrian has written for a range of business and finance titles including IFA, Investor Daily and Lawyer’s Weekly before joining the mortgages team in 2022.

He graduated from the University of Wollongong in 2021 gaining a Bachelor of Communication & Media with a major in Digital & Social Media.

E-mail Adrian at: This email address is being protected from spambots. You need JavaScript enabled to view it.