While many bank lenders remain mum on David Murray’s Financial System Inquiry published last week, four of Australia’s regional banks have called for a number of key recommendations as response.
The four regional banks - Suncorp Bank, ME Bank, BOQ and Bendigo and Adelaide Bank – suggested ways to expedite beneficial effects to consumers and welcomed Murray’s call for reducing the gap in risk-weighting of mortgages, placing additional capital for big banks and promoting disclosure of ownership structures by brokers.
Below are the following responses from chief executives to Murray’s Inquiry report:
Suncorp Bank CEO John Nesbitt said: “It is encouraging to see that Mr Murray and the Inquiry committee have acknowledged the need for action on competitive neutrality. The changes proposed on risk-weighted capital applied to major banks would narrow the gap. The Report recommends a 25% to 30% average mortgage risk weight be applied for those banks with advanced accreditation.”
ME Bank CEO Jamie McPhee said: “Regional Banks provide a strong competitive pressure in the market and a compelling alternative. Levelling the playing field - by removing funding and capital anomalies - will further improve competitive tension to the benefit of consumers.”
BOQ Acting CEO Jon Sutton said: “It is pleasing the Inquiry has acknowledged the competitive gap enjoyed by the majors needs to be closed and would like to see action taken quickly to address this issue, before the dominance of the Big Four is further entrenched. If that happens, Australian consumers will ultimately be the losers.”
Bendigo and Adelaide Bank CEO Mike Hirst said: “The regional banking sector is a critical part of Australia’s banking system. The sector offers high levels of customer satisfaction and service particularly in regional and rural Australia.”
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