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Despite the economic downturn, bank staff have to sell the same or more products as they have in recent years despite evidence that customers' appetite for debt products has dried up.



All banks have adjusted their lending criteria now to make mortgage lending more difficult to get. However, this only means that the most controversial loans (e.g. 100 percent mortgage) are now off the table.



In addition, mortgage applications and approvals are down 30 percent compared to last year and the housing market is struggling. Houses have lost 5 percent (or more) of their value and predictions are that this downward trend will continue. Twenty finance companies have gone bankrupt and investment in property development has also dried up due to unavailability of credit.



The impact of this is that it will be more difficult for staff to meet these targets than in previous years. However, this should not lead to irresponsible mortgage lending practices as New Zealand's record in this area has so far been much better than in the United States or in the United Kingdom.



UNI Finance and its affiliates believe that any remuneration system should promote the long-term interest of the company and should be linked to good customer service. Sales pressure must be avoided at all means as it leads to irresponsible lending practices and excessive risk taking. The global financial crisis has demonstrated this very clearly.



To read UNI Finance Statement on financial regulation: