NAB commits to implementing final Sedgwick recommendations
National Australia Bank (NAB) today reiterated its commitment to implement the final recommendations made by independent expert, Stephen Sedgwick AO, following his review into product- based commissions and payments in retail and small business banking.
NAB Chief Customer Officer, Consumer Banking and Wealth, Andrew Hagger said: “We are strongly committed to improving customer outcomes and building trust in the banking industry. These recommendations are a significant step for the industry and will require focus, discipline and strong leadership to implement them.
“We want our customers to be confident that every time they deal with their bank, they are receiving products and services that best suit their needs and we want to ensure bankers continue to be rewarded for doing the right thing.
“In October last year, NAB committed to the Sedgwick reforms and now that we have the final recommendations our focus is to implement them well ahead of the 2020 deadline”, Mr Hagger said.
The Sedgwick Review is part of the Australian Bankers’ Association’s (ABA) Better Banking reform package, which aims to protect consumer interests, increase transparency and accountability and build trust and confidence in the industry.
NAB has made a number of changes to strengthen remuneration and incentive arrangements:
- In 2016, we moved away from performance-based, fixed pay increases for customer service and support staff. These staff will receive a standard pay rise of 3% per year, under our 2016 NAB Enterprise Agreement;
- All our people have a balanced scorecard where demonstration of values is as important as performance metrics; and
- Higher standards for conduct and compliance.
In relation to the recommendations that impact third parties including mortgage brokers and aggregators, NAB agrees with Mr Sedgwick that any changes to their remuneration structure should be “viable” and “competitive”.
Mr Hagger said: “We see mortgage brokers and other third parties as an important part of the future of our business. We will be working closely with the industry, Treasury and with the regulators, ASIC and the ACCC, to make sure we get the right result for our customers and the industry”.
NAB does not pay volume-based incentives on residential mortgages to mortgage brokers.