Citibank has become the eighteenth lender to respond to a last-minute submission by AFG to the Financial System Inquiry.
In a letter to AFG managing director Brett McKeon, Citibank Australia managing director Julian Potter wrote of the significant role that mortgage brokers play within the broader mortgage industry.
“As an international bank operating in the highly concentrated Australian mortgage market, our connections with brokers – via aggregators like AFG – [are] important to creating diversity in the marketplace,” Mr Potter said.
“In recent years, with measures such as the NCCP Act 2009, and under regulation by ASIC, the broker market has continued to flourish, delivering consumers greater choice and accessibility.
“We agree that the long-term viability of the broker market is in the best interest of Australia’s mortgage industry,” he said.
Citi joins a host of lenders that have come out in support of the third-party channel in response to a surprising eleventh hour submission by AFG.
In the submission, AFG said the consolidation of the mortgage sector around the large ‘too big to fail’ banks has resulted in a situation where products from these organisations now account for 88 per cent of Australia’s mortgage volume.
“The presence of the mortgage broking industry is one of the few factors preventing the further entrenchment of the vertically-integrated banking sector in the mortgage sector,” AFG said.
The aggregator approached its lender panel seeking public endorsement of the broker channel.
So far, AFG has received written responses from seventeen lenders including Citi, AMP, Suncorp Bank, Adelaide Bank, ANZ, Pepper, NAB, ME Bank, La Trobe Financial, Heritage Bank, Bluestone, ING Direct, Wide Bay Australia, MyState, P&N Bank, Liberty, Bank of Queensland and Macquarie.
Acknowledgement was received but no endorsement provided by Westpac and Bankwest.
AFG is yet to receive any response from CBA or St George.Author: James Mitchell