Major bank scraps financial advice certificate for LRBAs

One of the major banks has revealed new system enhancements to its SMSF products, including the removal of a financial advice certificate requirement for SMSF lending.

Announced yesterday, St George Bank will implement the changes on Monday, 19 January.

“One of the changes that we have made with our SMSF loans is to remove the need for the financial advice certificate,” St George general manager of mortgage broking Clive Kirkpatrick told SMSF Adviser’s sister publication The Adviser.

“That was brought about through changes with FOFA,” Mr Kirkpatrick said.

“We removed that necessity as part of these changes,” he said, explaining that FOFA, new lending guidelines from APRA and the Financial System Inquiry’s final report will change the financial services landscape.

While brokers will no longer be required to seek a financial advice certificate when dealing with SMSF clients, St George will require certification from the trustee. 

“Obviously it is the trustee’s decision as to what they invest in,” Mr Kirkpatrick said.

“They need to understand all the risks and satisfy the suitability for the type of asset that is in the superfund, but we think this just makes it easier,” he said.

The new SMSF system enhancements also include a new online super fund calculator. Brokers will be able to use data from the calculator in their applications through auto-transfer of data to the application.

Brokers will also have the ability to correctly capture the complex super fund applicant structure, which St George claims will reduce errors and effort for brokers and assessors, leading to improved turnaround times to approval.

“We have always led the industry with our SMSF home loan, and today’s launch means we are also market leading in terms of a lodgement platform,” Mr Kirkpatrick said.

“We know this new platform really enhances our offering to brokers and their customers,” he said.

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