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NAB Broker unveiled a new stepped trail commission structure this afternoon.
From August 1, trail commissions on NAB loans will reflect the life of the loan, with payment increasing incrementally from the second year.
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Payment will rise from zero per cent in the first year to 0.15 per cent in the second year. There will then be a 0.05 per cent rise to trail commissions each year until capped at 0.35 per cent from year six onwards.
During April and May NAB Broker met with key partners in every state and regional areas to discuss the restructuring of commissions and seek feedback.
"This consultation process allowed us to address immediate concerns and also to reshape the way remuneration is structured to support the future of our industry," said Matt Lawler, regional general manager of NAB Broker.
NAB Broker also announced a new broker “Star Rating” system, which will see initial upfront commission payments for brokers shift from a flat 65 basis points to a sliding scale that will range between 50-65 basis points.
The quality of the business submitted will determine the level of commission paid.
The three key categories defining quality measures will be application quality, portfolio performance and education and professional development.
The ratings system will be measured and applied to brokers on an individual basis, and will commence from November 1 2008.
NAB Broker has also extended its clawback period to two years, effective August 1 2008.
From January 1 2009, the lender will also ony accept loans submitted electronically.
More details and analysis to follow tomorrow morning.
Published: 29-05-08
