The Four Major Australian Banks to Face Further Parliamentary Scrutiny in 2017
Wednesday 1 February 2017 @ 10.22 a.m. | Corporate & Regulatory | Taxation | Trade & Commerce
According to a recently published Media Release, the House of Representatives Standing Committee on Economics (HRSCE) will conduct further public hearings involving Australia’s four major banks in March 2017 as part of its review of the performance of Australia’s banking and financial system.
Previously, we have reported on attempts to impose more scrutiny and reviews on the operation of Australia's major banks and the banking system - see our articles: PM Announces Banks To Be Questioned By Parliamentary Committee, and Banking Commission of Inquiry Bill 2016 (CTH): New Royal Commission Proposed, dealing with a Private Member's Bill responding to specific issues said not to be addressed by the HRSCE.
Background to the HRSCE and Its Inquiry
In early August 2016, the Prime Minister, Malcolm Turnbull, and the Treasurer, Scott Morrison, announced in a joint press release that Australia’s four major banks would be called to appear before the HRSCE on a regular basis - a minimum of at least once a year. From such appearance the HRSCE would be asked by the Treasurer to examine and report to the Parliament on the banking and financial system. Banks would also be called separately to appear and explain how they were responding to funding issues and supporting Australian consumers and businesses.
The announcement of the HRSCE inquiry came on the back of increasing calls from the federal opposition for a royal commission into the banking industry, to which the Prime Minister responded by telling the ABC News that the planned HRSCE inquiry would “. . . drive some cultural change” by way of “. . . creating a regular and permanent method of accountability and transparency for the banks”, a result that, in the Prime Minister's view that would make it more effective than a royal commission, as the HRSCE review would be an on-going operation.
The HRSCE began its work on 15 September 2016 and is in the process of preparing its second report.
The Next Phase of the HRSCE
In the most recent HRSCE Media Release, the Committee Chair, MP Mr David Coleman, is quoted as saying that the HRSCE ". . . hearings provide an important mechanism to hold the banking sector to account before the Parliament."
The next phase for the HRSCE will be to continue to hold public hearings with the four major banks that will focus on:
- domestic and international financial market developments as they relate to the Australian banking sector and how these are affecting Australia;
- developments in prudential regulation, including capital requirements, and how these are affecting the policies of Australian banks;
- the costs of funds, impacts on margins and the basis for bank pricing decisions; and
- how individual banks and the banking industry as a whole are responding to issues previously raised in Parliamentary and other inquiries, including through the Australian Bankers' Association's April 2016 six point plan to enhance consumer protections and in response to Government reforms and actions by regulators.
According to the latest Media Release the schedule for the next round of hearings for this inquiry is 3-8 March 2017, as follows:
PUBLIC HEARING DAY 1 - NAB
Friday, 3 March 2017
Committee Room 2R1,
Parliament House, Canberra
9.15am to 12.15pm
PUBLIC HEARING DAY 2 - CBA and ANZ
Tuesday, 7 March 2017
Main Committee Room,
Parliament House, Canberra
CBA - 9.15am to 12.15pm
ANZ - 1.15pm to 4.15pm
PUBLIC HEARING DAY 3 - Westpac
Wednesday, 8 March 2017
Main Committee Room,
Parliament House, Canberra
9.15a
It will be interesting to see what comes from the HRSCE's continuing work on this line of inquiry and whether the continued scrutiny does have the results predicted by the Prime Minister and the Treasurer of a more accountable and customer aware banking system.
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