You are here

Australian banks face renewed push for intrusive inquiry

Thursday, February 9, 2017 - 14:10

36576728- AUSTRALIA BANKS.jpg
An unorthodox push for a wide-ranging inquiry into Australia's major banks has won the support of a key government politician in the country's finely balanced parliament, amid simmering public anger about corporate misconduct and market dominance.

[SYDNEY] An unorthodox push for a wide-ranging inquiry into Australia's major banks has won the support of a key government politician in the country's finely balanced parliament, amid simmering public anger about corporate misconduct and market dominance.

Independent lawmaker Bob Katter said on Thursday he would introduce a bill in parliament next month to set up an inquiry after it won the support of a member of the government, George Christensen.

An inquiry would create a headache for the "Big Four" banks - Commonwealth Bank of Australia, Westpac Banking Corp, Australia and New Zealand Banking Group and National Australia Bank - which have faced calls by some politicians for them to be broken up or taxed more heavily.

Mr Katter, who represents a remote area in the northern state of Queensland, said banks had used their lending power and carefully worded contracts to strip land from farmers during difficult times.

sentifi.com

Market voices on:

"The banks at their own discretion utilise fine print... to take your property away," Mr Katter told media outside parliament in Canberra.

Representatives of the four major banks declined to comment.

Australian Bankers' Association Chief Executive Steven Münchenberg said in a statement that banking practices were already being scrutinised and were improving.

"Taking action now is a better outcome than another government inquiry or Royal Commission," Mr Münchenberg said.

There is widespread public support for a far-reaching parliamentary investigation known as a Royal Commission into the banking sector, which is already struggling with tougher capital rules and slowing earnings growth after years of record profits.

The major lenders control 80 per cent of the country's lending but their reputations have been hit by a series of financial scandals.

Prime Minister Malcolm Turnbull's conservative ruling coalition - re-elected last year with a one-seat majority in the lower house - has promised greater government oversight but it has ruled out establishing a Royal Commission.

Instead, some MPs like Mr Katter are pushing for another form of parliamentary inquiry with lesser but still formidable powers.

In supporting Mr Katter's bill, Mr Christensen would be defying his own party's position while potentially helping a contentious piece of legislation pass through parliament.

"Royal Commissions are established by the executive, this one is much, much rarer," said Rodney Smith, professor of Australian politics at the University of Sydney.

"You will need to get both houses to agree and normally the government controls at least the lower house."

The opposition Labor Party did not immediately comment.

REUTERS

Nespresso
Pair your daily business read with the perfect cup of espresso.

Subscribe to The Business Times today to receive your very own Nespresso Inissia coffee machine worth $188.

Find out more at btsub.sg/btdeal

Powered by GET.comGetCom