Peter Cooper is one mortgage broker who has no time for any perceived benefits from banks trying to push loans on home buyers.
He is backing Stephen Sedgwick's proposed reforms of the nation's $1.5 trillion home loan market including ceasing non-transparent soft dollar payments, such as travel and hospitality paid to brokers to encourage lending.
"I am totally in favour of no soft dollar payments direct to brokers," Mr Cooper of Cooper Financial Connections said.
"There have been conference trips offered to top-performing brokers who have achieved certain benchmarks based on a criteria, but in my capacity as a mortgage broker I have always seen it as a potential conflict of interest that I do not need to be exposed to in completing my role."
His boutique broking business in Brisbane has built a reputation of not accepting any such inducements and as such he said he had not been offered anything as colourful as trips to the Bahamas.
He supports Sedgwick, a former Australian Public Service Commissioner who has conducted a review of remuneration for the bankers association and made wide-ranging recommendations about abolishing some forms of remuneration for brokers. Mortgage brokers and bankers have already broadly agreed on key ASIC recommendations that lenders cease paying volume-based incentives that are additional to upfront and trail commissions.
"I am comfortable with the approach and recommendations particularly around requesting the chief executives and executive teams to be responsible and accountable for managing the corporate values of the company which have been ignored for some time, even by board members."
"The values gather dust in annual reports and are never used to manage staff behaviours, which I believe are required to execute what they are proposing and has to be monitored down the management line."
He thinks brokers need an independent review or enterprise bargaining agreement so they can be remunerated better based on the workload they now perform on behalf of the banks. This will help them reduce costs at a time when some in the broking industry suggest banks are wielding pressure on them.
Mr Cooper said this is evidenced by the workload and additional costs incurred by brokers since the financial crisis, having regard to the fact their income was lowered during that time and has not returned to its original levels."
"Brokers today carry out tasks that were once performed by the banks staff," he said.
