28 February 2017
Media Release - #2017015, 2017

Turnbull Government welcomes ongoing parliamentary scrutiny of big four banks

Joint media release with
The Hon Kelly O'Dwyer MP
Minister for Revenue and Financial Services

The Turnbull Government welcomes the commencement this week of further House of Representatives Economics Standing Committee hearings with Australia's major banks and will respond to the Committee's first report in the near future.

The Review of the four major banks, initiated by the Turnbull Government, provides the opportunity for banks to explain how they are responding to the concerns of Australian consumers and businesses.

Work continues on the Turnbull Government's agenda to strengthen Australia's financial system and ensure fairer outcomes and better protections for Australian consumers.

The Government will formally respond to the Committee's first report following the conclusion of the latest series of hearings and release of the Productivity Commission's final report on Open Data due next month.

The Government is aware that the behaviour of the major banks has not lived up to the expectations of regular Australians. We are committed to stamping out this malpractice, while ensuring any victims have access to appropriate dispute resolution services and remedies.

That is why we are progressing our legislative agenda, with two significant pieces of legislation enacted this month: raising the professional standards for all financial advisers and reducing the incentives for life insurance products to be inappropriately replaced. And, before the parliament is a Bill that will increase the protection for retail client monies held by brokers and other intermediaries.

In addition, the Turnbull Government is undertaking further work to strengthen Australia's banking and financial system, in consultation with the Council of Financial Regulators. This work addresses recommendations in the Committee's First Report. These measures will increase competition, and offer more choice and protections for consumers.

The Government has already commissioned a number of landmark reviews into key elements of Australia's financial system, including:

  • Ian Ramsay's Review into Dispute Resolution and Complaints Framework. This includes responding to elements of Kate Carnell's Australian Small Business and Family Enterprise Ombudsman inquiry into the small business lending practices of the major banks and other lenders
  • The ASIC Enforcement Review taskforce is considering the adequacy of ASIC's regulatory toolkit to ensure it adequately detects misconduct, punishes wrongdoing and fosters consumer confidence
  • Productivity Commission's review into Data Availability and Use
  • The House Economic Standing Committee's Review of the four major banks

Once these reviews are finalised and handed to Government, a formal response will be provided addressing the recommendations of each.

These reviews build on the Government's response to the Financial System Inquiry and ASIC Capability Review. This suite of policies is backed by $121 million in extra resources to strengthen the Australian Securities and Investments Commission (ASIC).

I look forward to further recommendations being made by the House of Representatives Economics Committee and to working to address any unsatisfactory treatment of Australian consumers.

The Turnbull Government is committed to ensuring financial system regulators have the power needed to protect consumers and maintain the stability of Australia's financial system. The Government looks forward to increased competition in the banking sector and a more agile financial system.