Banking inquiry has formidable task
Today’s headlines about super savings being pushed into low-return accounts that help boost the profits of the big four banks highlight the task ahead of the newly appointed Financial System Inquiry panel.
According to front-page stories in the Sydney Morning Herald and The Age today, big bank-owned fund managers are putting super savings into accounts operated by their big bank parents.
“This is another illustration of the risks arising from a highly concentrated financial system dominated by four vertically-integrated players,” said COBA CEO Louise Petschler.
“The banking inquiry must make this problem a top priority.
“Our system favours the big four banks, with an unfair cost-of-funding advantage and inadequate incentives for genuine competition.
“COBA welcomes finalisation of the inquiry’s terms of reference and we congratulate Professor Kevin Davis, Mr Craig Dunn, Ms Carolyn Hewson and Dr Brian McNamee on their appointments to the inquiry panel.
“The inquiry panel’s experience in the banking industry includes inquiry chair David Murray’s 13 years as CEO of CBA, Ms Hewson’s 10 years as a Westpac director and her current role as chair of the Westpac Foundation, and Professor Davis’ 10 years as a director of Melbourne University Credit Union.
“We welcome Treasurer Hockey’s timetable for the inquiry, with submissions due by the end of March, an interim report released by mid-2014 and a second round of submissions before a final report to Government expected by November 2014.
“This gives all stakeholders plenty of opportunities to make their case and engage with the inquiry. COBA is looking forward to assisting the inquiry it in its task of developing recommendations to foster an efficient, competitive and flexible financial system.
“We are confident the inquiry will examine issues of competitive neutrality and accommodating the customer-owned model to optimise competition and consumer choice.”
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Daniel McDougall, Senior Manager – Media and Communication
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