Commission Rates

Offset/Utilization Rules

Notes & Definitions

Clawbacks

Adjustments & Variations

Deposit Products

Initial Commission for loan products for a facility used for construction purposes is calculated based on the net facility increase at settlement date (T), and for other facility purposes, based on the net facility increase at T+4 business days and paid in the month after calculation.

Any loan settlement occurring in the last 4 days of the month, the upfront commission will be held over to the next month. The upfront commission is then calculated and paid on the day 5 adjusted balance and payment made the following month e.g. If the loan settles on the 27th of June, the commission will be calculated on 1st July and be paid in the August commission run.

Initial commission is not paid on a Net Facility increase that relates to an application made direct to AMP Bank by a customer.

AMP Bank may reduce the Net Facility Amount on which commission would be paid under a new loan or varied facility, by the amount (if any) by which the amount of credit provided under any existing facility or loan with AMP Bank or any Related Body Corporate is reduced as a result of the provision of the new or varied facility. This reduced amount is the Net Facility Increase.

If AMP reasonably believe that the primary purpose of a transaction or a series of transactions have been structured in order to artificially increase the commission that would be payable (e.g., by moving funds between loans or facilities to generate additional commission) it reserves the right not to pay commission. AMP will seek to engage with the broker who would receive that commission in order to understand the intent of those transactions and the benefits to the customer before making any decision not to pay commission.

Ongoing Commission: is calculated at the at the end of each month and paid the following month.

Trail commission for new loans or variations are based on the new calculation

(Daily net balance averaged throughout the month X number of days in the month divide by the days in the year X commission %).

Net balance accounts for draw down amount, redraw balance, offset balance, fees, applied interest (not accrued) and transactions.

Where trail commission relates to a Loan and repayments under one or more Facilities under that Loan are in arrears, as defined in the Loan Agreement, for two consecutive calendar months, no trail commission is payable for so long as those repayments continue in arrears.

Where trail commission relates to a Facility no further trail commission is payable once the amount owed by the Customer under the Facility is repaid in full.

Trail commission ceases to be payable in relation to a Loan where a subsequent Successful Application is made in relation to that Loan which was not arranged by a broker that is managed by the aggregator.

Where a successful application is made and a one of the following (loss circumstances) arises: (a) Broker lodges a fraudulent application (b) Broker has given false or misleading information to AMP Bank (c) Broker is not a Licensee or Authorised Credit Representative or has acted in breach of an ACL or Authorised credit condition (d) Withheld information that may affect the outcome of a customer’s application, the broker is not entitled to any upfront and trail and will be required to repay any upfront and trail already paid.

If the total linked offsets are greater than the facility balance outstanding, the excess offset will be applied against any other facilities within the loan. This will impact upfront and trail commissions.

This rule will apply for the first 12 months after a loan has settled for loans settling on or after 1st January 2021.

If a loan is made up of facilities which do not offer offset e.g. Line of credit, the excess offset in an eligible product will be used to reduce the amount of commission payable for those facilities which do not offer an offset.

The excess rule applies from the settlement date. However, the excess offset will be applied at the relevant commission payment dates i.e. settlement + 4 business days (upfront commission), 180 days for a utilisation review and end of month for trail payment.

Construction loans do not have excess offset applied.

The variation is done within the first year of a loan that is settled on or after 1st January 2021, the variation is included in this rule, but the excess offset timeline does not reset.

This rule is only applicable for the 1st year (365 days) of the original loan settlement date.

Although a line of credit cannot have a linked offset, the excess can be applied from another facility if within the same loan structure.

Conflicted Remuneration: has the meaning given in Division 4 part 7.7A of the corporation’s act and includes grandfathered benefits under the traditional provisions of the act.

Initial Commission: means the commission paid by AMP Bank in relation to settlement.

Net Facility Amount equals the credit limit of the Facility – (any available redraw amount + linked offset account balances)

Net Facility Increase: means the increase in the Net Facility Amount under a new or varied facility, less the amount (if any) by which the amount of credit provided under an existing loan with AMP Bank or any related body corporate is reduced as a result of the provision of the new varied facility.

Reduction Event: means full repayment of and closure of a facility or the reduction of the contractual limit of a facility.

T+4: means 4 business days after the day of settlement.

T+180: means 180 calendar days after the day of settlement.

Settlement: means the day on which AMP Bank successfully advances funds to the Customer pursuant to a new loan agreement or a variation to a loan agreement (not the customer exercising redraw under a loan agreement).and provides a confirmation that has occurred.

Successful Application: means in the case of a loan or facility 4 business days after settlement of the loan or variation.

For Subsequent Commission calculation, AMP will review the net balance position at 180 days after settlement period to assess if clawback is applicable. Post 180 days after settlement, the net balance position will be reviewed if a facility limit variation occurs. Net balance will be assessed to determine if clawback is applicable.

Line of Credit Product (LOC) commission calculation rules will be brought in line with the commission rules applying to term mortgage loans. At 180 days after a loan limit increase, a review will be added for term loans and LOC.

Construction loan upfronts changed to a monthly commission payment. Initial commission is calculated at settlement and paid no later than the month after settlement occurs. For a facility used for construction purposes, on the last day of each month after settlement, an adjustment will be made to reflect changes to the net facility amount. The adjustment is calculated as follows: End of Month Adjustment = (net facility amount at the end of month – net facility amounts at the end of the previous month) X Initial Commission Rate. A positive amount is paid by AMP Bank. The adjustment is calculated at the end of each month following settlement, and any related payment subsequently made, until fully drawn or the construction loan changes to another type of loan.

Facilities other than Construction Loans – Initial commission is calculated at T+4 and paid in the following month. If there is a settlement in relation to a facility within T+180, there will be no adjustment at T+180 from the previous settlement and the date of the settlement constitutes a new T in relation to that settlement and the following calculation occurs at the new T+4: Facility Variation Adjustment = (net facility amount – net facility amounts at the previous Successful Application) X Initial Commission rate. A positive amount is paid by AMP Bank. A negative amount may be offset against commission that would otherwise be paid by AMP Bank.

If a Facility is varied after T+180, if the previous settlement of the Facility, was on or after 1st January 2019 the following will apply at T+4: Facility Variation adjustment = (net facility amount – net facility amounts at the later of T+180 or the previous Successful Application) X Initial Commission Rate. In each case, a positive amount will be paid by AMP Bank. A negative amount may be offset against commission that would otherwise be paid by AMP Bank.

A Facility is part of a loan. When an adjustment is made to a loan Facility AMP Bank may calculate the commission on each facility that comprises the loan. The calculation for each Facility that comprises the loan is totaled and, a positive total amount will be paid by AMP Bank, and a negative amount results in no further payment being made by AMP bank but does not need to be repaid to AMP Bank.

Adjustments to Initial Commission at T+180: This does not apply to a Facility for a construction purpose or an internal refinance of a facility. If there is no Successful Application in relation to a facility in the T+180 period, an adjustment will be made at T+180 to reflect changes to the Net Facility Amount over that period. T+180 adjustment = (net facility amount at T+180 – net facility at T+4) X Initial Commission Rate. A positive amount is paid by AMP Bank. A negative amount may be offset against commission that would be otherwise be paid by AMP Bank.

For a Facility with a settlement before 1st January 2019. The following calculations will apply on the first variation in the contractual limit of a Facility, Facility variation adjustment = (net facility amount – previous facility limit) X Initial Commission Rate. On any subsequent variations made within 180 calendar days of the variation. Facility Variation Adjustment = (net facility amount – net facility limit at the last settlement before 1st January 2019) X Initial Commission Rate.

For Internal refinances which settle on or after 1 October 2020, in addition to the existing commission payment 4 business days after settlement, a 180 day review of loan utilisation will be added. If the loan has increased additional commission may be paid (no commission will be clawed back as a result of the 180 day review).