Mortgages

BNZ's ads escape censure - just

The Bank of New Zealand has narrowly escaped censure over its “we’ve cut out brokers” advertising campaign.

Monday, December 27th 2004

A man in Christchurch, presumably a broker, called G Hill, complained to the Advertising Standards Complaints Board that the BNZ ad campaign was “miss-leading (sp) and dishonest”.

His argument was that BNZ withdrew from the broker market as it wasn’t doing very well there and that mortgages sourced through brokers are more cost-efficient than bank-originated home loans.

BNZ hit back at the allegations saying firstly that margins had been falling and broker commission costs had been rising.

“We felt we could offer our customers better interest rates by cutting out the middle man,” BNZ said in its submission.

It says cutting out the brokers meant a better deal for lenders. To prove its point the bank supplied some illustration of costs. The costs in the following table using “illustrative” margins and loan sizes have been used to prove its case.

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Unity First Home Buyer special 4.29
SBS FirstHome Combo 4.29
Co-operative Bank - First Home Special 4.85
China Construction Bank 4.85
ICBC 4.85
TSB Special 4.89
Kiwibank Special 4.89
ASB Bank 4.89
SBS Bank Special 4.89
Westpac Special 4.89
BNZ - Std 4.89
Nelson Building Society 4.93
ICBC 4.95
SBS Bank Special 4.95
China Construction Bank 4.95
Wairarapa Building Society 4.95
TSB Special 4.95
ANZ Special 4.95
ASB Bank 4.95
Kainga Ora 4.95
Westpac Special 4.95
AIA - Go Home Loans 4.95
SBS Bank Special 5.39
Westpac Special 5.39
ICBC 5.39
Co-operative Bank - Owner Occ 5.59
BNZ - Std 5.59
BNZ - Classic 5.59
AIA - Go Home Loans 5.59
ASB Bank 5.59
Kainga Ora 5.69
Kiwibank Special 5.79
ANZ 5.79
SBS Construction lending for FHB 3.94
AIA - Back My Build 4.44
CFML 321 Loans 4.99
Co-operative Bank - Owner Occ 5.95
Co-operative Bank - Standard 5.95
Heartland Bank - Online 5.99
Pepper Money Prime 6.29
Kiwibank - Offset 6.35
Kiwibank 6.35
TSB Special 6.39
Kainga Ora 6.44

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