Australia Banking & Finance Sector Set for Reform
As part of their current review of Australia's banking sector, especially targeting the "Four Major Banks", the House of Representatives Standing Committee on Economics (Parliamentary Committee) has tabled its first report in Parliament.
In the report, the Parliamentary Committee sets out a number of recommendations to the Treasurer and the Parliament, that includes:
- establishing a new regime for executive accountability that includes the public "name and shame" of senior employees who breach licensing rules;
- establishing a Banking and Financial Sector Tribunal by 1 July 2017;
- establishing a new, permanent regulator tasked with the day-to-day monitoring of competition in the banking sector and examining competition rules in the sector every 6 months;
- forcing banks to alert customers if their financial planner is in breach of the law;
- forcing banks to provide open access to their consumer data by 1 July 2017;
- a review of regulatory barriers to starting banks with a view to encouraging more competition; and
- implementing new structures to improve internal dispute resolution processes and risk management systems within banks.
The Government is yet to provide its response to the Parliamentary Committee's recommendations. However, Australian Financial Review has reported that the Treasurer views the recommendations as "very constructive" and "very practical".
The Parliamentary Committee plans to hold further public hearings with the major banks and the Reserve Bank of Australia in 2017.
For more information
If you would like more information about the Parliamentary Committee's review of the banking and finance sector, the Parliamentary Committee's recommendations, and how they may potentially affect you if adopted as law, please contact us.