The multi-national bank says that loans generated by brokers have not delivered the returns required by it in New Zealand.
'We want to focus on where our strengths lie,' Caetano Fernandes, head of personal financial services told brokers in an email giving notice of its intention to quit the broker market.
HSBC would concentrate in future on dealing directly customers to provide “complete financial solutions”.
Another email shows that all the broker team have been made redundant: 'My entire team (the HSBC Broker unit) has been given formal notice of redundancy, to be effective 29 Sept.'
HSBC hasn't returned any of Good Returns calls to discuss the issue.
Mike Pero of Mike Pero Mortgages (MPM) said he did not believe that HSBC was selling large volumes of loans through brokers. For MPM it provided about one to 1.5% of funding.
'They are a niche player,' he said.
HSBC bought the AMP mortgage business a number of years ago and has continued to lose market share.
It recently changed its rate structures. The new pricing tends to indicate it is chasing high dollar loans.
For loans of less than $300,000 its fixed rate is the standard (gold) rate plus 0.20% and there is no discount for floating rate.
For loans of $300,000 to $749,999 the fixed rate is its standard/gold rate and a 0.25% discount for floating.
At the next and top tier of $750,000 plus it is offering a 0.05% discount on fixed and 0.50% on floating.
The key changes are a lowering of the qualifying band for gold to $300K -$749K ($250K-$749K outside Auckland) and introduction of the platinum band for loans more than $750K.
Its silver package has been discontinued.
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