Brokers have been left baffled by acting FCA chief executive Tracey McDermott’s comments on reintroducing advice into bank branches.
Brokers have been left baffled by acting FCA chief executive Tracey McDermott’s comments on reintroducing advice into bank branches.
McDermott was talking to MPs on the Public Accounts Committee in the House of Commons earlier this week and said banks should return to giving advice – but should make it clear whether they are advising or selling.
She told the committee: “We are starting to see those sales forces be reintroduced. We would like them to be reintroduced but we would like them to be reintroduced in a way where they are actually clear whether they are giving advice [or] whether they are selling to you.”
But Jonathan Burridge, an independent mortgage broker based in East London, said: “Bank advice branches shouldn’t come back – clear and simple. The intermediary market does it cheaper and better and I don’t see that changing because of the availability of products being sold by banks.
“They are good at providing products and services so let them do that – that’s what they do well and allow us to do what we do well.
“Surely that’s in the best interest of consumers and the regulator.
“When you can only sell one type of product how can you not influence somebody purchasing it?”
Rob Ashley-Roche, principal of Rest Assured Mortgages, agreed that it’s difficult to draw this line between advising and selling.
He said: “If you’re selling you’re telling somebody they should have something in which case they’re giving advice. If you’re not giving advice the customer needs to be coming to you and telling you what they want.
“Banks aren’t very good at doing execution-only. In the past people went to the bank and thought they were getting whole of market advice.
“If the bank is going to have any form of mortgage adviser they have to give advice – here is no execution only route.”
