28 August 2017
Transcript - #2017163, 2017

Interview with Kieran Gilbert, Sky News

SUBJECTS: Government backs APRA CBA inquiry; Turnbull Government’s take-action-now approach to the banks

KIERAN GILBERT:

I am just joined by the Treasurer, we have breaking news that APRA are launching this inquiry into the CBA, you welcome this development obviously?

TREASURER:

Absolutely. We have been working with the regulators now for some weeks, I mentioned that after meeting with Catherine Livingston some weeks ago re the CBA matter. It is appropriate for the regulators to be the ones to undertake these inquiries. So, they are taking action now. That is entirely consistent with the Turnbull Government’s approach to the banks which is to take action now. This is yet another plank in what has been done to ensure that the banks are doing the right thing by their customers.

GILBERT:

This is, as I said, news that is breaking. As far as you are aware what is the scope of this investigation?

TREASURER:

It is largely looking at organisational culture and practices. It doesn’t go, rightly, to the issues that are before the courts with AUSTRAC. But now, we have had a series of events at CBA, it is appropriate that they look more broadly at what is happening and to form any views that may need to be formed about what is necessary to address that behaviour. At the end of the day though, this is a matter for the bank’s board and this is really where APRA has set its task – to look at the culture within the organisation and whether this series of events we have now seen at CBA equate to something else going on there.

GILBERT:

Does this nullify once and for all in your view, the calls for a Royal Commission, or is this just CBA specific and not industry-wide as Labor would advocate?

TREASURER:

Labor’s position is a political one. It’s not about fixing problems in the banking system, it’s about grandstanding by Bill Shorten. What this shows again is a government and its regulators just getting on with the job of taking action now when it comes to the banks. Now I’ll be introducing legislation in the next few weeks which will put the toughest accountability controls on banking executives the country has ever seen. Now that is taking action right now. We have also got a new financial complaints authority coming into being which is dealing with one of the key issues and grievances Australians have had with their banks; that when they have a case to present, they can’t get it heard and you need an army of lawyers to deal with it. So we are taking action now, APRA is taking action now…

GILBERT:

You are cognisant of the impact on the victims?

TREASURER:

Absolutely.

GILBERT:

Because that is the thing that underpins Labor’s point here, that they want adequate compensation for those adversely affected.

TREASURER:

Well a Royal Commission is not going to give that to them. A Royal Commission is not going to award one dollar of compensation to anyone. This is the great con. It can’t. It can make some recommendations, but it can’t make a finding that gives anybody anything. What we can do is what we are doing, and that is taking action right now with a better complaints authority, stronger regulations on banking executives; the regulators doing their job in addressing any governance or organisational or cultural problems that are occurring in these institutions. But I should stress at the same time Kieran, all of our banks are prudentially strong, there is no issue here about the systemic strength of our banking system whatsoever. The issues here go to matters of culture within banks and this is what APRA is focussing on and seeing what risks that is presenting for those organisations and importantly their customers.

GILBERT:

Treasurer, thanks for coming on for the breaking news, APRA’s investigation into the CBA.