National Bank of Canada (NBC) has once again revamped its broker status program. It’s become an annual ritual at the bank, it seems.

This year, we got more good to go with less bad, which was a nice change from recent years.

Here’s what’s to love about NBC’s latest tweaks for the coming year:

• The bank’s league-leading broker efficiency bonus (up to 40 bps extra comp for some brokers) is now much simpler. Instead of having to meet “approval ratios” and “approval-to-fund ratios,” brokers now qualify for the efficiency bonus by meeting only one ratio, submit-to-fund. That makes it easier for brokers to track progress and set goals for their teams. It also means that you better know NBC’s guidelines because declines will cost you.
• NBC’s top status level now requires 65 deals a year, down from 75. That makes it more attainable, and worth aiming for if you’re a mid-size broker with only so much volume to go around.
• Brokers can now qualify for travel voucher incentives by meeting volume goals instead of just unit goals.
• Brokers can now get up to 40 bps extra compensation on doctor and engineer financing. Those professionals get preferred credit line rates of prime + 0.00% and prime + 0.25% accordingly. This will meaningfully incentivize brokers to generate more such deals, which delivers asset-rich clients with excellent incomes to the bank.
• Brokers can now get up to 40 bps extra compensation on switch/transfers.

Policies that need re-thinking:

• NBC now requires 100 closed deals to qualify for its $5,000 travel voucher incentive, up from 75 deals.
• It also capped those travel vouchers to three per year, versus unlimited.
• In exchange, it’s offering to take the broker and one guest on an NBC broker trip (destination to be announced). A broker trip is swell but personal trips are better. These travel vouchers were big lures for large brokers. This and the above changes could demotivate high-producing brokers from striving for higher volume levels once they hit 65 deals (the magic number to earn top status). It’s probably a short-sighted move, but time will tell.
• Penalizing declines will cost NBC submissions. It needs an official program whereby if a BDM vets a deal, it doesn’t count against the broker if it’s declined. Barring that, the bank will lose a lot of deals that lie in the grey area of its guidelines, and that brokers are too afraid to send up, for fear of hurting their efficiency.
• NBC’s 1- and 2-year terms still get no love. Not only are the rates average at best, but brokers still cannot apply NBC’s $500 to $1,000 cashback, or 20-40 bps extra comp options. That wouldn’t be a big deal if NBC’s 1- and 2-year terms qualified for its free transfer program, but they don’t (that’s not unusual, but some lenders will in fact cover switch costs on short terms). NBC says its margins are simply too thin to offer incentives on shorter terms.

What the jury is still out on:

• To qualify for efficiency bonus, the bank now assesses a 12-month rolling average of the broker’s submit-to-fund ratio (instead of six months previously). This is supposed to “smooth” out the numbers. The problem is, if you’ve had a bad month, it could stick with you a while.

National Bank has been slipping in broker market share and these changes may not be enough to turn around that ship. It has consciously chosen to be an industry leader in pushing efficient business over raw volume.