CBA will SCRAP their Supergear product, effective 12th October 2018. A decision to refine their product offering to become a “simpler, better bank” is their reasoning to exit the LRBA market. The bank will accept new business up to 12th October 2018, conditional upon loans being funded and settled by 28th December 2018.
CBA are the most recent bank to pull out of the LRBA market after Westpac Group (Bank of Melbourne, St George) made a similar announcement in mid-July. AMP Bank are currently reviewing their SMSF product offering which leaves Liberty Financial, AMP Bank and Macquarie Bank as the three mainstream players at this time.
It is thought capital adequacy requirements, which are diminishing the profitability of these products, has been one of the direct drivers of lenders exiting the market.
It will be interesting to see who is open for business in the LRBA space in 6 months’ time.