As federal treasurer Josh Frydenberg prepares to release Kenneth Hayne’s report from the banking royal commission today, the man representing the nation’s finance and mortgage brokers has revealed he is sleeping comfortably.
Peter White, managing director of the Finance Brokers Association of Australia (FBAA), said despite some isolated criticism of the broking sector and reporting that he labelled “misinformed and sensational”, he is not expecting a massive shake up of the industry.
“It is an indisputable fact that there are only a minuscule amount of finance brokers who have done the wrong thing, and they’ve been caught and thrown out of the industry by the regulators, which shows the system is working,” he explained.
Mr White, who has spent almost 40 years in the finance and lending industry including roles as CEO of well known lenders, described the royal commission as “the biggest baseball bat to hit the industry that he’s ever seen”, but said finance brokers – who write over 54 per cent of the nation’s mortgages – had already been through a reform process.
“This royal commission is about the greed of the big banks and insurance companies, and so it should be because their behaviour has been appalling.
“The broking sector was well ahead of the game, as we’ve already been through reviews from ASIC and the Productivity Commission. Before the royal commission was established we changed a number of practices in the interests of openness and transparency.”
He said customers were voting with their feet and trusted brokers far more than the banks.
“Customers get a better outcome by using a mortgage broker. They get better service, more choice and a well trained finance expert to take them through what is a massive and stressful time of their life.”
The FBAA was one of the main parties that pushed for the National Consumer Credit Protection Act, which ensures borrowers are more aware of what they are signing up for.
Mr White said while he’s confident that the report will show the high values and ethics of brokers, he’s prepared to fight hard for the industry if there are any unexpected recommendations.