National Australia Bank announces dumping of introducer program

National Australia Bank has taken action after the Hayne Royal Commission by dumping its controversial mortgage introducer program.

National Australia Bank has revealed it will dump its controversial Introducer Program that paid “introducers” commissions to refer new home loans to the financial institution.

The program came under fire during the financial services Royal Commission and about 300 staff were sacked or exited the bank in the past year for code of conduct breaches.

Under the program NAB paid commissions to businesses including financial planning and real estate agencies who referred customers to take a loan with the big bank.

The bank’s chief executive officer Philip Chronican said it would end the Introducer Program from October 1 this year.

This means NAB will no longer provide referral payments to introducers.

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National Australia Bank’s former chief executive officer Andrew Thorburn exited the bank earlier this year.

“Through the Royal Commission we heard clearly that our actions need to meet the expectations of our customers and the community,” Mr Chronican said in a statement.

“We need to be simpler and more transparent to earn trust.

“We have to put customers first to be a better bank.”

It was understood through the Introducer Program the information provided for the loan-approval process came via third-party referrers instead of the customers themselves.

NAB came under intense scrutiny during the Royal Commission and commissioner Kenneth Hayne singled out former chief executive officer Andrew Thorburn and chairman Ken Henry for their questionable performance during the hearings.

Both were subsequently forced to stand down.

And earlier this month former chief of staff to Mr Thorburn, Rosemary Rogers, was charged for $40 million fraud against the bank.

This included 56 counts of corruptly receiving a benefit and dishonestly obtaining financial advantage by deception.

Human Group director Helen Rosamond was also charged with dozens of bribery offences, one count of obtaining benefit by deception and one count of attempting fraud.

Rosamond allegedly used cash to ensure her training company maintained a contract with NAB between 2013 and 2017.

Mr Chronican said these new changes to dump the Introducer Program would be significant for the bank and help deliver better outcomes for customers.

“Like other businesses we will still welcome referrals and will continue to build strong relationships with business and community partners,” he said.

“However there will be no “introducer” payments made.”

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