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Version 3 Version 4
Banking inquiry: ANZ has 'appetite' to reconsider credit card interest rates – live Banking inquiry: ANZ has 'appetite' to reconsider credit card interest rates – live
(35 minutes later)
1.48am BST
01:48
Adam Bandt asks about ANZ lending money to Timbercorp and whether there was a condition that other investors put up their houses or other security for their investment.
Deputy chief executive Graham Hodges denies imposing any conditions to control how Timbercorp dealt with its investors except for “normal [conditions] around credit criteria to support a securitisation structure”.
Asked what input ANZ has had in the liquidation process, Hodges says it encouraged establishment of a hardship program.
Bandt asks for all ANZ documents relating to Timbercorp and and its liquidator, and will make a more specific request in writing. ANZ takes it on notice.
1.46am BST
01:46
After Adam Bandt said ANZ gave $1.65m to the two major parties over 10 years, here’s a quick fact check on their most recent donations:
Adam Bandt's $1.65m figure was for many years. Last annual return shows ANZ gave $100k to Liberals and $80k to ALP. https://t.co/F8HQHSYSh7
1.41am BST
01:41
Greens MP Adam Bandt has asked how ANZ justifies that fact it gave $1.65m to the Coalition and Labor between 2004 and 2015 to its shareholders.
CEO Shayne Elliott responds:
We justify it by saying we are supporting the democratic process in the country.
Elliott refused that the bank considers donations an “investment” to achieve outcomes like avoiding a bank royal commission.
He reveals that there are “discussions at the board level about the role of political donations” and whether to continue making them.
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at 1.44am BST
1.32am BST
01:32
Shayne Elliott says his salary as chief executive is $2.1m a year plus, $2.1m in short-term and $2.1m in long-term incentives.
The pay of a teller is “about the $50-60,000 mark”.
He says contingent elements of pay are based on performance metrics including people management, financial results and customer satisfaction.
Balance is key to ensure remuneration based on performance is a “healthy driver in their behaviour and doesn’t drive poor outcomes”, he says.
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at 1.54am BST
1.25am BST
01:25
Deputy chief executive, Graham Hodges, says ANZ will “always provide assistance” when customers say they are experiencing hardship.
He says the customers’ issues are “not just the card itself” but other financial problems, including bills and unexpected events.
“That’s what financial hardship is,” Labor MP Matt Keogh responds. He suggests that given evidence that 90% of customers experience hardship because of unexpected events after getting a card, 10% must have had financial problems when they got the card.
Chief executive Shayne Elliott responds that they may simply have overextended themselves after the bank gave them credit.
1.13am BST1.13am BST
01:1301:13
Shayne Elliott reveals ANZ’s credit card business makes “a couple of hundred million dollars” out of its total profit of $7.5bn. He accepts that movements in funding costs “unless they are extreme” are not going to have a significant impact on the bank’s profits.Shayne Elliott reveals ANZ’s credit card business makes “a couple of hundred million dollars” out of its total profit of $7.5bn. He accepts that movements in funding costs “unless they are extreme” are not going to have a significant impact on the bank’s profits.
1.11am BST1.11am BST
01:1101:11
Labor’s Matt Keogh makes a declaration before beginning his questions:Labor’s Matt Keogh makes a declaration before beginning his questions:
Dollarmites yesterday, today @mattkeogh admits to having one of ANZ's "high interest, high fee" credit cards...Dollarmites yesterday, today @mattkeogh admits to having one of ANZ's "high interest, high fee" credit cards...
1.00am BST1.00am BST
01:0001:00
ANZ has "appetite" to reconsider credit card interest ratesANZ has "appetite" to reconsider credit card interest rates
Shayne Elliott says ANZ has an “appetite” to consider restructuring its credit card products.Shayne Elliott says ANZ has an “appetite” to consider restructuring its credit card products.
He concedes the headline interest rate on credit card rates may be too high and could be changed so that there is a “better correlation between pricing and risk”.He concedes the headline interest rate on credit card rates may be too high and could be changed so that there is a “better correlation between pricing and risk”.
Liberal MP Scott Buchholz heralds the concession (without a commitment) as “a good day for Australians”.Liberal MP Scott Buchholz heralds the concession (without a commitment) as “a good day for Australians”.
12.55am BST12.55am BST
00:5500:55
Liberal MP Scott Buccholz has challenged the proposition in Shayne Elliott’s opening statement that ANZ wants credit card rates to be “as low as possible”.Liberal MP Scott Buccholz has challenged the proposition in Shayne Elliott’s opening statement that ANZ wants credit card rates to be “as low as possible”.
The chief executive qualifies that he meant: “as low as possible, competitively”.The chief executive qualifies that he meant: “as low as possible, competitively”.
Deputy chief executive, Graham Hodges, says the bank has run a trial with 1% of its customers who showed signs of financial hardship to suggest they use different products like a different credit card.Deputy chief executive, Graham Hodges, says the bank has run a trial with 1% of its customers who showed signs of financial hardship to suggest they use different products like a different credit card.
Some were “quite offended” others found it “very helpful”, he said.Some were “quite offended” others found it “very helpful”, he said.
12.45am BST12.45am BST
00:4500:45
Pat Conroy has asked whether the government and Reserve Bank implicitly subsidise the big four banks to the tune of $3.7bn because of the fact they are “too big to fail”.Pat Conroy has asked whether the government and Reserve Bank implicitly subsidise the big four banks to the tune of $3.7bn because of the fact they are “too big to fail”.
The deputy chief executive, Graham Hodges, disputes that this constitutes “government support”.The deputy chief executive, Graham Hodges, disputes that this constitutes “government support”.
Rather it is the markets and ratings agencies which have a view that Australian banks have a higher credit rating because of a perception that authorities would step in in the event of financial crisis, he says.Rather it is the markets and ratings agencies which have a view that Australian banks have a higher credit rating because of a perception that authorities would step in in the event of financial crisis, he says.
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at 1.01am BSTat 1.01am BST
12.41am BST12.41am BST
00:4100:41
Pat Conroy has asked about ANZ’s return on equity in its credit card business.Pat Conroy has asked about ANZ’s return on equity in its credit card business.
Shayne Elliott repeats a similar objection to the CBA’s, that it is “difficult for us to disclose without giving away competitive information”.Shayne Elliott repeats a similar objection to the CBA’s, that it is “difficult for us to disclose without giving away competitive information”.
He accepts the return on equity for credit cards is higher and “well above” average but says it is “decreasing at a fairly fast rate”.He accepts the return on equity for credit cards is higher and “well above” average but says it is “decreasing at a fairly fast rate”.
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at 1.00am BSTat 1.00am BST
12.36am BST12.36am BST
00:3600:36
The Labor MP Pat Conroy has asked if Shayne Elliott is confident that bank managers don’t put pressure on tellers to refer customers to financial planners after they’d already met their minimum targets.The Labor MP Pat Conroy has asked if Shayne Elliott is confident that bank managers don’t put pressure on tellers to refer customers to financial planners after they’d already met their minimum targets.
The chief executive sys: “No, and I’m not necessarily sure that’s a bad thing.”The chief executive sys: “No, and I’m not necessarily sure that’s a bad thing.”
If we believe having good conversations with specialists is a good thing, then generally more is better.If we believe having good conversations with specialists is a good thing, then generally more is better.
If staff feel under duress, pressure or are harassed there are avenues for them to discuss that.If staff feel under duress, pressure or are harassed there are avenues for them to discuss that.
UpdatedUpdated
at 12.59am BSTat 12.59am BST
12.33am BST
00:33
Gareth Hutchens
With the ANZ hearings under way, it appears National Australia Bank has now banned all political donations.
NAB’s board of directors says it “resolved in May 2016 that the making of any political donations would cease with immediate effect”, according to its policy statement on political donations.
The document says NAB recognises it has an important role to play in Australia’s political process, and in the development and promotion of policy, but it now believes that can be better achieved by avoiding making political donations altogether.
Therefore, “from May 2016 NAB ceased making political donations at the commonwealth, state and local government level”.
It means the federal Liberal, National and Labor parties will lose a crucial source of political funding:
Updated
at 12.52am BST
12.30am BST
00:30
Asked about the fact the ANZ has referred 45 breach reports to Asic in the last year, Shayne Elliott replies:
We are raising the standards at which we operate ... when we find problems, we report them.
Elliott says there are about 2,000 people in the financial planning division, which the Labor MP Pat Conroy calculates is about one in 40 subject to breach reports.
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12.26am BST
00:26
'Not enough' of most senior ANZ bank executives are women: Elliott
Shayne Elliott has addressed ANZ’s diversity policy and the Male Champions of Change program.
He replies:
My key objective is that we have an open, transparent, fair and diverse workforce.
Elliott says, of the bank’s senior leadership roles, 40% are held by women but “not enough of the most senior roles”.
The Liberal MP Julia Banks asks if Elliott has read her maiden speech because of her warnings for the need for unconscious-bias training. He has not.
Elliott says the bank has done an “extraordinary amount” of such training but he is not sure at which levels and how far down the bank it has extended.
Updated
at 12.55am BST
12.20am BST
00:20
The Liberal MP Julia Banks has asked about an “endemic blokey culture” at the bank, including reports of sexist banter and attendance at strip clubs.
Shayne Elliott agrees that “culture is key”.
Asked about two employees sacked over code of conduct violations who then launched unfair dismissal claims exposing this culture, he replies:
It is in their interests to make such allegations. Unfortunately there were a small number of people in the markets division that behaved appallingly. When we found out, we acted immediately.
Updated
at 12.55am BST
12.13am BST
00:13
Matt Thistlethwaite has asked – same as yesterday – whether the chief executive is prepared to return if the committee asks. Shayne Elliott gives a simple answer: “Yes.”
Updated
at 12.28am BST
12.12am BST
00:12
Matt Thistlethwaite is quizzing the ANZ executives about league tables for performance of branches.
The bank’s chief executive, Shayne Elliott, says league tables do exist but branches are not just measured on the one metric of sales but also customer feedback and their performance relative to their opportunity (based on where the bank is located).
Updated
at 12.27am BST
12.05am BST
00:05
Katharine Murphy
While the bank hearings are under way, the prime minister, Malcolm Turnbull, has been on the ABC in Brisbane.
He has 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 10 or 15 minutes.
Turnbull’s response to the time limits was to suggest the committee members recall the bank CEOs “as often as they like”.
The prime minister suggested the committee move to extend the hearings if members didn’t sufficient time had 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 said the problem with banks was they were 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.
Updated
at 12.27am BST
12.03am BST
00:03
Shayne Elliott has been quizzed about dealings with the Indian tycoons Pankaj and Radhika Oswal. The bank reached a legal settlement with the pair in a dispute about the winding up and sale of their Australian fertiliser business Burrup Holdings.
Pankaj Oswal allegedly forged documents to show the company had the support of European banks before 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”.
Updated
at 12.25am BST
11.54pm BST
23:54
Labor’s Matt Thistlethwaite is asking about ANZ financial planners that have been banned by Asic, including one for 10 years as a result of falsifying documents, and one who is contesting a one-year ban after resigning from the bank.
ANZ’s chief executive, Shayne Elliott, explains:
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.
Updated
at 12.24am BST
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’s 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.
Updated
at 12.23am BST