BNZ campaign putting pressure on margins
Wednesday 26 May 2004
Bank of New Zealand’s anti-broker campaign is having a significant impact on banking industry profit margins across the board, says Brian Hayr, senior manager of third party origination at National Bank.
By The Landlord
BNZ’s campaign is heavily focused on its two-year fixed homeloan rate at 6.89% and uses the slogan: "We’ve cut out brokers to give you a great home loan deal."The other four major banks’ published two-year fixed rates are between 7.3% and 7.4%.
"It’s stripping out major value. The margins we’re seeing now are some of the toughest we’ve seen," Hayr told the Plan New Zealand annual conference earlier this month.
It is a very long time since a major bank has so aggressively tried to undercut its competitors and the other banks are being forced to cut their profit margins too, he says.
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