Home loan Advantedge unrelated to 'break up'

NAB CEO Cameron Clyne also pointed out, at yesterday's investor briefing, that the bank was "forced to make a significant uplift in capability in the frontline sales force and mortgage processing" - something management has had to work on since its admission, in the mid-2000s, that barely one home loan in 10 funded by the bank was sourced through bank branches.

While management cited a lift in home loan volumes over the half (of 10 per cent over the last six months), management seemed careful not to attribute this rise to any particular initiative, such as the elimination of some penalty fees in 2009, the elimination of exit fees late last year (and offers to pay the exit fees of CBA and Westpac) or the more recent "break-up" campaign.

Indeed, there was virtually no reference by management at the briefing, unless asked, to this marketing initiative, with speakers avoiding crediting the campaign with any specific results.

In fact, the improving home loan volumes appear to be coming through NAB's Advantedge arm and brokers.

Volumes from Advantedge increased $3.3 billion, to $7.9 billion, during the March 2011 half-year over the six months prior.

New loan settlement volumes via NAB Broker increased by 141 per cent in the March 2011 half year, compared with the same period in 2010.

This data does not directly align with the net increase of A$13 billion in home loans in Australia reported in the bank's financial statements.

However, it does reinforce the point that as yet there's little tangible evidence that the "reputation" strategy driving product initiatives in retail banking is generating much new business through NAB's branch or online sales channels.