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Banking inquiry: ANZ chief executive Shayne Elliott to face questions – live Banking inquiry: ANZ chief Shayne Elliott apologises for failings – live
(35 minutes later)
12.05am BST
00:05
Katharine Murphy
While the bank hearings are underway, the prime minister Malcolm Turnbull has been on the ABC in Brisbane.
He’s been grilled about how this parliamentary inquiry compares with a royal commission, which has subpoena powers, and would have a long period to interrogate witnesses, as opposed to a process where individual committee members face time limits of ten or fifteen minutes.
Turnbull’s response to the time limits was to suggest the committee recall the bank CEOs “as often as they like.”
The prime minister suggested the committee move to extend the hearings if they don’t feel like sufficient time has been given to pursue the issues.
The prime minister (who declared himself earlier in the interview as “a businessman, who had gone into politics at the age of 50”, and an “activist”) has told his host Steve Austin:
I understand the banking industry and I understand what’s wrong with it.
He says the problem with banks is they are insufficiently transparent and accountable to their customers.
That’s why “my government” (as opposed to, as he said, earlier in the interview, “Tony’s government”) had insisted on the parliamentary hearings for the banking CEOs.
Over time this will change the culture of accountability in the banks.
12.03am BST
00:03
Shayne Elliott has been quizzed about dealings with Indian tycoons Pankaj and Radhika Oswal. The bank reached a legal settlement with the pair over a dispute about the winding up and sale of their Australian fertiliser business Burrup Holdings.
Mr Oswal allegedly forged documents to show the company had the support of European banks ahead of getting a further $1bn in loans from ANZ.
Elliott explained the bank continued to advance the business credit because claims of forgery were just allegations and Oswal had withdrawn an admission relating to it.
At that stage and it was in the interests of the bank for the project to go ahead, because a “half finished” fertiliser plant would be “worth nothing”.
11.54pm BST
23:54
Labor’s Matt Thistlethwaite is asking about ANZ financial planners that have been banned by ASIC, including one banned for 10 years as a result of falsifying documents, and one that is contesting a one year ban after resigning from the bank.
ANZ chief executive Shayne Elliott explained:
We have not - to date - specifically advised those clients [that their advisers have been banned], we are going to. There is a gap in our process – we should [advise their clients].
To check how common it is for financial planners to be banned, take a look at Guardian Australia’s big timeline of banking scandals.
11.49pm BST
23:49
ANZ chief thinks bank victim tribunal "a good idea"
Asked about a bank victim redress tribunal, Shayne Elliott says the only consideration is that it must be “simple and effective for customers”.
I think it’s a good idea, we have no issue with a bank tribunal.
Commonwealth Bank chief executive, Ian Narev, raised some practical considerations but no objection to this tribunal when asked on Tuesday.
Labor’s financial services spokeswoman, Katy Gallagher, labelled the plan put forward by backbench Coalition MPs for a bank tribunal to grant victims compensation a “stitch up” designed to avoid a royal commission.
11.47pm BST
23:47
Shayne Elliott says ANZ will enable customers to transfer data to other banks but “we have to make sure that our customers are protected in the process”.
Asked if ANZ had resisted proposals facilitate portability of accounts to help customers switch banks, Elliott replied:
As an institution we may have, but I haven’t and at this point today we don’t oppose it at all.
11.40pm BST
23:40
CEO defends reinstatement of employees under Bank Bill Swap Rate cloud
Shayne Elliott is explaining what has happened to individuals at the bank whose conduct has been questioned by the Australian Securities and Investments Commission which has taken action against ANZ for alleged unconscionable conduct and manipulating the Bank Bill Swap Rate between 2010 and 2012.
He said two employees had been fired for violating the banks code of conduct, but the rest had been reinstated after initially being stood down.
Because we’ve done our own internal investigations and believe they’ve done nothing wrong.
Elliott said the individuals whose conduct had resulted in ASIC legal action against the bank had not been charged as individuals.
11.35pm BST
23:35
Under questioning from the committee chairman, David Coleman, the ANZ chief executive, Shayne Elliott, has admitted the bank overcharged 400,000 customers fees it was not entitled to.
The bank paid back $2.9m in fees. He explained the overcharging was caused by a “misinterpretation around terms and conditions of those fees” for moving money between accounts.
Elliott said processes had been improved but he couldn’t say whether there were disciplinary consequences for the mistake.
Updated
at 11.43pm BST
11.32pm BST11.32pm BST
23:3223:32
Shayne Elliott has addressed failings in its farm lending business Landmark, which it acquired in 2010. Shayne Elliott has addressed failings in ANZ’s farm lending business Landmark, which it acquired in 2010.
He accepted the bank should have worked better with customers, especially when they were already in difficulty.He accepted the bank should have worked better with customers, especially when they were already in difficulty.
This was wrong, we were too slow to fix it and we apologised.” This was wrong, we were too slow to fix it and we apologised.
On Timbercorp, Elliott said the bank had worked with liquidator to help investors in financial distress but had not recommended people invest in the scheme.On Timbercorp, Elliott said the bank had worked with liquidator to help investors in financial distress but had not recommended people invest in the scheme.
Updated
at 11.42pm BST
11.27pm BST11.27pm BST
23:2723:27
Shayne Elliott is now addressing the interest rates the ANZ charges Shayne Elliott is now addressing the interest rates the ANZ charges.
“We need our lending rates to be as low as possible to attract and retain business,” he said.“We need our lending rates to be as low as possible to attract and retain business,” he said.
He explained the sources of funds are: equity invested by shareholders; deposits, which account for only 50% of funds for borrowing; and international borrowings.He explained the sources of funds are: equity invested by shareholders; deposits, which account for only 50% of funds for borrowing; and international borrowings.
When the RBA changes rates it directly impacts some but not all of our funding costs.When the RBA changes rates it directly impacts some but not all of our funding costs.
Updated
at 11.42pm BST
11.24pm BST11.24pm BST
23:2423:24
The chief executive has explained that ANZ made a profit of $7.5bn last year, but said “we’re a very large business assets of $900bn”, and amounts to less than 1 cent per dollar the bank holds. The chief executive has explained that ANZ made a profit of $7.5bn last year, but said “we’re a very large business assets of $900bn”, and that amounts to less than 1 cent for every dollar the bank holds.
The trend of returns in the last decade at ANZ has decreased from almost 20% down to little over 12%, Elliott said.The trend of returns in the last decade at ANZ has decreased from almost 20% down to little over 12%, Elliott said.
Updated
at 11.41pm BST
11.23pm BST11.23pm BST
23:2323:23
CEO Shayne Elliott starts with an apology for ANZ failingsCEO Shayne Elliott starts with an apology for ANZ failings
ANZ chief executive, Shayne Elliott, has got the mea culpa part of appearing before a parliamentary committee out of the way early, offering this apology in his opening statement: The ANZ chief executive, Shayne Elliott, has got the mea culpa part of appearing before a parliamentary committee out of the way early, offering this apology in his opening statement:
In truth we’ve not always met the standards we’ve set for ourselves or that the community rightfully expects of us. Each time we fall short we potentially harm a customer or a member of the community, and for that I apologise.In truth we’ve not always met the standards we’ve set for ourselves or that the community rightfully expects of us. Each time we fall short we potentially harm a customer or a member of the community, and for that I apologise.
Updated
at 11.41pm BST
11.18pm BST11.18pm BST
23:1823:18
And we’re off! The ANZ witnesses at the table are: chief executive, Shayne Elliott, and deputy chief executive, Graham Hodgson. And we’re off! The ANZ witnesses at the table are: the chief executive, Shayne Elliott, and the deputy chief executive, Graham Hodges.
A reminder or notice for those who weren’t following on Tuesday, the House of Representatives Economics Committee examining the big four banks is chaired by Liberal MP David Coleman and its deputy chair is Labor’s Matt Thistlethwaite. A reminder or notice for those who weren’t following on Tuesday, the House of Representatives economics committee examining the big four banks is chaired by the Liberal MP David Coleman. Its deputy chair is Labor’s Matt Thistlethwaite.
The other members are: Liberals Craig Kelly, Julia Banks, Scott Buchholz and Trevor Evans; The Nationals’ Kevin Hogan; Green Adam Bandt; and Labor’s Pat Conroy and Matt Keogh. The other members are: Liberals Craig Kelly, Julia Banks, Scott Buchholz and Trevor Evans; the Nationals’ Kevin Hogan; Green Adam Bandt; and Labor’s Pat Conroy and Matt Keogh.
For those who’d like to watch along a live stream is available here.For those who’d like to watch along a live stream is available here.
Updated
at 11.47pm BST
11.06pm BST11.06pm BST
23:0623:06
Australian Bankers Association chief executive, Steven Munchenberg, has told ABC News Breakfast on Wednesday that sackings should “absolutely” be part of disciplinary consequences if bank employees have done the wrong thing. The Australian Bankers’ Association chief executive, Steven Münchenberg, has told ABC News Breakfast on Wednesday that sackings should “absolutely” be part of disciplinary consequences if bank employees have done the wrong thing.
We have acknowledged, as an industry, and we heard that from the CBA boss yesterday, that we have not always lived up to expectations.We have acknowledged, as an industry, and we heard that from the CBA boss yesterday, that we have not always lived up to expectations.
Munchenberg defended high credit card rates to cover the risk of debts that aren’t recovered, and said that mortgages that track the official cash rate were not popular when they were offered overseas. Münchenberg defended high credit card rates to cover the risk of debts that aren’t recovered, and said mortgages that track the official cash rate were not popular when they were offered overseas.
On financial advice and conflicts of interest, he said:On financial advice and conflicts of interest, he said:
We’ve actually announced an independent review of the way in which ... bank staff are paid … and we’ve indeed committed to removing or changing any payments that do lead to poor customer outcomes.We’ve actually announced an independent review of the way in which ... bank staff are paid … and we’ve indeed committed to removing or changing any payments that do lead to poor customer outcomes.
Updated
at 11.39pm BST
10.45pm BST10.45pm BST
22:4522:45
Timbercorp scandal and credit card fees to feature at ANZ hearingTimbercorp scandal and credit card fees to feature at ANZ hearing
Welcome to our live blog of day two of parliamentary committee hearings into the big four banks.Welcome to our live blog of day two of parliamentary committee hearings into the big four banks.
On Tuesday the committee heard from the Commonwealth Bank, whose chief executive Ian Narev revealed nobody had been sacked for the CommInsure denial of insurance payout scandals. On Tuesday the committee heard from the Commonwealth Bank, whose chief executive, Ian Narev, revealed that nobody had been sacked for the CommInsure denial of insurance payout scandals.
Today it is the turn of ANZ, with hearings to run from 9:15 to 12:15 AEDT. Today it is the turn of ANZ, with hearings to run from 9.15 to 12.15 AEDT.
Labor plans to ask ANZ’s chief executive, Shayne Elliott, about the Timbercorp scandal, financial planners banned from the bank, and remuneration structures that encouraged staff to offer financial advice unfit for customers. Labor plans to ask ANZ’s chief executive, Shayne Elliott, about the Timbercorp scandal, financial planners banned from the bank and remuneration structures that encouraged staff to offer financial advice unfit for customers.
ANZ is being pursued in the courts – along with NAB and Westpac – by the Australian Securities and Investments Commission over alleged unconscionable conduct and manipulating the Bank Bill Swap Rate between 2010 and 2012.ANZ is being pursued in the courts – along with NAB and Westpac – by the Australian Securities and Investments Commission over alleged unconscionable conduct and manipulating the Bank Bill Swap Rate between 2010 and 2012.
Liberal MP, Craig Kelly, plans to raise credit card fees. In August Kelly told Guardian Australia the high court had weakened consumer protections when it rejected a class action against ANZ for charging late fees of $35. The Liberal MP Craig Kelly plans to raise credit card fees. In August Kelly told Guardian Australia the high court had weakened consumer protections when it rejected a class action against ANZ for charging late fees of $35.
After the first day of hearings Labor and the Greens already made it clear they will continue to push for a full royal commission. Let’s see if they are more satisfied with the answers provided by ANZ. After the first day of hearings Labor and the Greens made it clear they will continue to push for a full royal commission. Let’s see if they are more satisfied with the answers provided by ANZ.
Comments for the live blog are open – so please contribute your take on proceedings below. You can contact me on Twitter @Paul_Karp.Comments for the live blog are open – so please contribute your take on proceedings below. You can contact me on Twitter @Paul_Karp.
Updated
at 11.39pm BST