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You can find the current article at its original source at https://www.theguardian.com/australia-news/live/2016/oct/05/banking-inquiry-anz-chief-executive-shayne-elliott-to-face-questions-live
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| Version 5 | Version 6 |
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| Bank inquiry: ANZ has 'no link' to Malaysian 1MDB scandal – as it happened | |
| (35 minutes later) | |
| 2.40am BST | |
| 02:40 | |
| The second day of bank hearings has concluded, ending ANZ’s testimony to the House of Representatives Economics Committee. | |
| What we learned today: | |
| Updated | |
| at 2.46am BST | |
| 2.24am BST | 2.24am BST |
| 02:24 | 02:24 |
| Matt Thistlethwaite has returned to why rate rises are passed on “like rockets” but rate cuts are passed on “like feathers”. | Matt Thistlethwaite has returned to why rate rises are passed on “like rockets” but rate cuts are passed on “like feathers”. |
| Deputy chief executive, Graham Hodges, says the delay can be caused by determining what the best interest rate is and moving rates at a convenient time to avoid multiple movements rather than a calculation that the bank makes money for every day it delays a rate cut. | Deputy chief executive, Graham Hodges, says the delay can be caused by determining what the best interest rate is and moving rates at a convenient time to avoid multiple movements rather than a calculation that the bank makes money for every day it delays a rate cut. |
| 2.13am BST | 2.13am BST |
| 02:13 | 02:13 |
| Asked by Liberal MP Trevor Evans to address the perception that banks pass on rate rises quicker than rate cuts, ANZ chief executive Shayne Elliott says: | Asked by Liberal MP Trevor Evans to address the perception that banks pass on rate rises quicker than rate cuts, ANZ chief executive Shayne Elliott says: |
| It’s not our intention – I understand a lot of people will be cynical about that. | It’s not our intention – I understand a lot of people will be cynical about that. |
| He says ANZ wants to move rates on a more regular basis, but “people expect them ... shortly after [Reserve Bank] moves, so that’s what we will do”. | He says ANZ wants to move rates on a more regular basis, but “people expect them ... shortly after [Reserve Bank] moves, so that’s what we will do”. |
| Updated | Updated |
| at 2.25am BST | at 2.25am BST |
| 2.06am BST | 2.06am BST |
| 02:06 | 02:06 |
| Liberal MP Craig Kelly has questioned why the difference between home loan interest rates and those for small business loans secured by houses has increased over time. | Liberal MP Craig Kelly has questioned why the difference between home loan interest rates and those for small business loans secured by houses has increased over time. |
| ANZ chief Shayne Elliott denies this reflects lack of competition – and points to the fact the risks on small business loans secured by a house are 10 times greater than a home loan. A regulatory change also increased the amount of capital that needs to be held by 60% relative to a home loan. | ANZ chief Shayne Elliott denies this reflects lack of competition – and points to the fact the risks on small business loans secured by a house are 10 times greater than a home loan. A regulatory change also increased the amount of capital that needs to be held by 60% relative to a home loan. |
| Asked if there has been a substantial increase in risk in lending to small business, he replies: | Asked if there has been a substantial increase in risk in lending to small business, he replies: |
| No. This was covered yesterday – it reflects that the risk was incorrectly priced in the past. | No. This was covered yesterday – it reflects that the risk was incorrectly priced in the past. |
| Updated | Updated |
| at 2.24am BST | at 2.24am BST |
| 1.57am BST | 1.57am BST |
| 01:57 | 01:57 |
| "No link" to 1MDB scandal, Shayne Elliott says | "No link" to 1MDB scandal, Shayne Elliott says |
| Adam Bandt has quizzed the ANZ executives about its role sitting on the board of Malaysian bank AmBank which held billions in the 1MDB funds at the centre of a global financial scandal. | Adam Bandt has quizzed the ANZ executives about its role sitting on the board of Malaysian bank AmBank which held billions in the 1MDB funds at the centre of a global financial scandal. |
| More than $US1bn is alleged to have flowed into Malaysian prime minister Najib Razak’s bank accounts between January 2011 and April 2013 — much of it from 1MDB. | More than $US1bn is alleged to have flowed into Malaysian prime minister Najib Razak’s bank accounts between January 2011 and April 2013 — much of it from 1MDB. |
| ANZ chief executive Shayne Elliott says he is satisfied nobody employed by ANZ did anything wrong and the bank was not being investigated by the US Justice Department. | ANZ chief executive Shayne Elliott says he is satisfied nobody employed by ANZ did anything wrong and the bank was not being investigated by the US Justice Department. |
| He says the bank has no relationship with 1MDB, or link to what is alleged to have happened. | He says the bank has no relationship with 1MDB, or link to what is alleged to have happened. |
| Updated | Updated |
| at 2.11am BST | at 2.11am BST |
| 1.48am BST | 1.48am BST |
| 01:48 | 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. | 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”. | 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. | 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 its liquidator, and will make a more specific request in writing. ANZ takes it on notice. | Bandt asks for all ANZ documents relating to Timbercorp and its liquidator, and will make a more specific request in writing. ANZ takes it on notice. |
| Updated | Updated |
| at 2.06am BST | at 2.06am BST |
| 1.46am BST | 1.46am BST |
| 01:46 | 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: | 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 | 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 | 1.41am BST |
| 01:41 | 01:41 |
| ANZ considering stopping political donations | ANZ considering stopping political donations |
| The Greens MP Adam Bandt has asked how ANZ justifies to its shareholders the fact it gave $1.65m to the Coalition and Labor between 2004 and 2015. | The Greens MP Adam Bandt has asked how ANZ justifies to its shareholders the fact it gave $1.65m to the Coalition and Labor between 2004 and 2015. |
| CEO Shayne Elliott responds: | CEO Shayne Elliott responds: |
| We justify it by saying we are supporting the democratic process in the country. | We justify it by saying we are supporting the democratic process in the country. |
| Elliott denies the bank considers donations an “investment” to achieve outcomes such as avoiding a bank royal commission. | Elliott denies the bank considers donations an “investment” to achieve outcomes such as 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. | He reveals that there are “discussions at the board level about the role of political donations” and whether to continue making them. |
| It comes after NAB’s board of directors said 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. | It comes after NAB’s board of directors said 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. |
| Updated | Updated |
| at 2.14am BST | at 2.14am BST |
| 1.32am BST | 1.32am BST |
| 01:32 | 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. | 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”. | 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. | 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. | Balance is key to ensure remuneration based on performance is a “healthy driver in their behaviour and doesn’t drive poor outcomes”, he says. |
| Updated | Updated |
| at 1.54am BST | at 1.54am BST |
| 1.25am BST | 1.25am BST |
| 01:25 | 01:25 |
| Deputy chief executive, Graham Hodges, says ANZ will “always provide assistance” when customers say they are experiencing hardship. | 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. | 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. | “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. | Chief executive Shayne Elliott responds that they may simply have overextended themselves after the bank gave them credit. |
| 1.13am BST | 1.13am BST |
| 01:13 | 01:13 |
| 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 BST | 1.11am BST |
| 01:11 | 01:11 |
| 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 BST | 1.00am BST |
| 01:00 | 01:00 |
| ANZ has "appetite" to reconsider credit card interest rates | ANZ 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 BST | 12.55am BST |
| 00:55 | 00:55 |
| 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 BST | 12.45am BST |
| 00:45 | 00:45 |
| 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. |
| Updated | Updated |
| at 1.01am BST | at 1.01am BST |
| 12.41am BST | 12.41am BST |
| 00:41 | 00:41 |
| 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”. |
| Updated | Updated |
| at 1.00am BST | at 1.00am BST |
| 12.36am BST | 12.36am BST |
| 00:36 | 00:36 |
| 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. |
| Updated | Updated |
| at 12.59am BST | at 12.59am BST |