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The Banking Enquiry

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At the House of Reps Economics Committee enquiry into banking on Tuesday Labor Member Matt Thistlethwaite asked Ian Narev from the Commonwealth Bank whether he wouldn’t prefer a royal commission to the 20 enquiries into the banks that are taking place at the moment.

Mr Narev said that his extensive consultations had indicated that a royal commission would be dangerous for the banks, the regulators and the public.

The committee chairman, David Coleman, appropriately enough the MP for the NSW seat of Banks, seems determined to prove that a royal commission is unnecessary by running a very tough line of questioning into banking practice.

He has been pressing a line that executives who are responsible for regulatory breaches should be named and shamed within five days of a breach occurring.

While ANZ and Westpac are prepared to go along with the proposal, the Commonwealth Bank and NAB are opposed.

They argue that executives are often unaware of the breaches and that it may not be possible to identify a responsible senior executive within five days.

Narev says disclosure in the annual report is sufficient.

On Wednesday Westpac CEO Brian Hartzer was asked why it appeared that his bank was being investigated by ASIC for an alleged breach every month.

Hartzer’s response was that Westpac was being investigated for a number of things including overcharging on credit card debt, complaints about insurance payments, financial planning and lending practices.

He said that, while the bank had no complaints about ASIC, it was contesting some of the actions in court. Anna Bligh, the new CEO of the Australian Banking Association, made her first appearance before the committee on Wednesday, international women’s day which is appropriate since she’s now the senior woman in the sector.

She pressed the case against the royal commission but didn’t argue that there were too many enquiries into the banks.

No one seems to want to go into bat for the taxpayers.

Kate Critchley

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