You are using an older browser version. Please use a supported version for the best MSN experience.

Bank inquiry: execs to blame for breaches

AAP logoAAP 24/11/2016 Stuart Condie

Senior executives have created a "poor compliance culture" at the four major banks and should be named and shamed when customers are mistreated, a parliamentary inquiry has found.

The report on the banks by the the House of Representatives economics committee said it was unacceptable that no senior executive had lost their job over a string of scandals that include the provision of poor financial advice at National Australia Bank and the mishandling of life insurance claims at Commonwealth Bank.

"The major banks have a 'poor compliance culture' and have repeatedly failed to protect the interests of consumers," the report said.

"This is a culture that senior executives have created. It is a culture that they need to be held accountable for."

The report expressly rejected an assertion by NAB chief executive Andrew Thorburn - who like his counterparts at ANZ, CBA and Westpac, appeared before the committee in October - that financial planners were responsible for their own misconduct.

It urged that bank executives and financial planners should have their culpability and punishments for any misconduct made public, with a banks' victims tribunal to be established by July.

The report also called for a unit to continually monitor competition in the banking sector and report to the federal treasurer every six months.

"Australia's banking sector is an oligopoly. The major banks have significant market power that they use to protect shareholders from regulatory and market developments," committee chair David Coleman said.

"Despite this market concentration, under our current regulatory structure no entity is tasked with regularly making recommendations to improve competition. This must change."

The four banks received the 139-page report when it was made public on Thursday morning. While ANZ said it was still digesting the document, NAB said it would respond once the federal government has decided which recommendations it will adopt.

Westpac said it too is waiting on the government's response.

"While we may not agree with all aspects of the report, the committee can play a constructive role in building on industry reforms that are currently being implemented," Westpac said in a statement.

Investors appeared unconcerned by the report as shares in all four banks finishing in positive territory against the backdrop of a flat overall market.

image beaconimage beaconimage beacon