Bank snubs originators

Standard Bank is not accepting any new applications for home loans received from bond originators, Business Report said on Wednesday.

The action seems to be related to efforts by all the major banks to renegotiate the agreements that the banks have with mortgage originators — and specifically to slash the commissions paid to originators, the newspaper said.

The newspaper quoted spokesman for Standard Bank, Ross Linstrom, as saying the banking group was still in talks with mortgage originators.

However, he said it was not appropriate to comment at this stage.

Business Report said Willie van Aardt, the chief executive of Finbond, the listed bond originator, had confirmed that Standard Bank had withdrawn completely from the mortgage origination market.

However, there had not been any formal communication from the bank related to this action, Van Aardt said.

Saul Geffen, the chief executive of ooba, said the process of engagement with the banks was "well advanced, noting that the renegotiation of certain agreements had already been concluded".

The report said that although Standard Bank was declining home loans from external origination channels, ooba believed the bank's approach was an interim one.

Geffen said commission levels for originators were now lower than before, "given the changed lending and credit environment".

However, Geffen told Business Report that the origination industry remained sustainable and he saw no impact on consumers.

ooba had earlier this year successfully applied to the High Court in Cape Town to make Standard Bank comply with the terms of its agreement.

According to Business Report, Absa and First National Bank had already completed the renegotiation of agreements with mortgage originators.

Sapa

Article from: www.iafrica.com