Westpac makes major commission changes
TMM Online understands the lender has contacted bosses of New Zealand's biggest adviser groups to inform them of wide-ranging changes due to come into force in July.
The bank is increasing upfront commission to mortgage advisers from 45 basis points to 60 basis points, and removing discretionary commissions previously paid up to 15 basis points quarterly.
Westpac is also toughening up commission clawback periods. If a loan is repaid from 0-16 months after it is taken out, there will be 100 per cent clawback. If a loan is repaid between 16-26 months 50 per cent of commission will be clawed back.
It comes after Westpac conducted a major review into the way it pays commission to financial advisers. It is unclear whether some of the changes were motivated by Australia’s Banking Royal Commission, which has placed a spotlight on commission models across the Tasman.
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