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| Banking inquiry: 43 financial planners sacked from NAB 'not a systemic issue' – live | |
| (35 minutes later) | |
| 12.09am BST | |
| 00:09 | |
| Chief executive Andrew Thorburn said that since a 2015 Senate inquiry into the banks, NAB has now committed to report all sacked planners to Asic not just those who it believed committed a reportable breach. | |
| Of 43 planners sacked between 2010 and 2015 not all were reported at the time, but “Asic would know about them now”, he said. | |
| Asked if compliance had been inadequate, the NAB CEO accepts that was “absolutely one of the reflections that we’ve took”. He says there are more checks and balances including reviews now. | |
| 12.02am BST | |
| 00:02 | |
| The NAB chief executive reveals that $892,000 has been paid in compensation to clients of five planners who were deregistered by Asic. He said $800,000 of that related to one planner. | |
| 12.01am BST | |
| 00:01 | |
| NAB only wrote to clients it believed were affected by struck-off planners. | |
| Andrew Thorburn is addressing a question about five planners who were deregistered, and boasts that NAB found four of them itself before notifying the regulator, the Australian Securities and Investment Commission. | |
| Thorburn takes on notice whether it has contacted every client of those financial planners. He then reveals in two cases it had contacted all clients, in two it had contacted only those it considered to be affected, and in one case it didn’t write to the clients because they weren’t financially affected. | |
| We’ve been more targeted ... where we feel there is any concern, we will be going back to clients again. | |
| 11.56pm BST | |
| 23:56 | |
| The committee’s deputy chairman, Labor’s Matt Thistlethwaite, notes that the CBA and ANZ started with an apology but NAB didn’t. | |
| Chief executive Andrew Thorburn denies that he believes there is no need to apologise. | |
| I have apologised - to the customers, particularly in the financial advice division ... I have apologised and I do so again [today]. | |
| 11.54pm BST | |
| 23:54 | |
| Andrew Thorburn said NAB would support efforts to make account switching easier, by having portable accounts and customer data. | |
| He predicts a new cross-industry payments platform will allow account portability by the end of next year. | |
| Chairman David Coleman wants NAB to commit to tie pay to delivering data-sharing, the executives express “in principle” support for data-sharing and account portability. Thorburn takes the question on tying remuneration to the outcome on notice. | |
| 11.46pm BST | |
| 23:46 | |
| Chief operating officer Antony Cahill says the bank could offer “rate-tracker” mortgages that move automatically when the cash rate moves. | |
| But he said the interest rate would “potentially be significantly higher than our standard variable rate” because the cash rate isn’t the only cost of funds for a mortgage. | |
| 11.43pm BST | 11.43pm BST |
| 23:43 | 23:43 |
| David Coleman has asked about the wealth management division paying more than $25m in compensation to 62,000 customers. | David Coleman has asked about the wealth management division paying more than $25m in compensation to 62,000 customers. |
| NAB chief executive Andrew Thorburn plays down the quantum of the compensation, noting it has $180bn in assets under management. | NAB chief executive Andrew Thorburn plays down the quantum of the compensation, noting it has $180bn in assets under management. |
| We have had these isolated cases, we have owned up to them, and we have addressed them. | We have had these isolated cases, we have owned up to them, and we have addressed them. |
| Responding to earlier questions about poor financial advice, the chief executive said: | Responding to earlier questions about poor financial advice, the chief executive said: |
| I’ve met some of these customers. Our advice was poor, wrong and not right. And I’ve apologised to them. | I’ve met some of these customers. Our advice was poor, wrong and not right. And I’ve apologised to them. |
| 11.39pm BST | 11.39pm BST |
| 23:39 | 23:39 |
| 43 planners sacked from NAB "not a systemic issue" | 43 planners sacked from NAB "not a systemic issue" |
| NAB chief executive Andrew Thorburn, asked about 43 planners dismissed from the bank, said it commissioned an independent review and concluded: | NAB chief executive Andrew Thorburn, asked about 43 planners dismissed from the bank, said it commissioned an independent review and concluded: |
| We concluded that there was not a systemic issue. | We concluded that there was not a systemic issue. |
| He said there are 1,700 planners in the bank and “the vast majority are doing the right thing”. Committee chairman David Coleman said one in 40 planners terminated was hardly a “black swan event”. | He said there are 1,700 planners in the bank and “the vast majority are doing the right thing”. Committee chairman David Coleman said one in 40 planners terminated was hardly a “black swan event”. |
| Asked how many senior executives have been terminated due to the problems, the chief executive replied: “I don’t think there’s any but I’ll take that on notice”. | Asked how many senior executives have been terminated due to the problems, the chief executive replied: “I don’t think there’s any but I’ll take that on notice”. |
| We didn’t think it was appropriate that anybody’s employment be terminated, apart from the planners themselves. | We didn’t think it was appropriate that anybody’s employment be terminated, apart from the planners themselves. |
| Some executives have had bonuses withheld as result though, he adds, as well as there being harm to the reputation of the bank. | Some executives have had bonuses withheld as result though, he adds, as well as there being harm to the reputation of the bank. |
| 11.32pm BST | 11.32pm BST |
| 23:32 | 23:32 |
| We’re now into the questioning stage. | We’re now into the questioning stage. |
| There was a large overlap between questions to the CBA and ANZ executives on the first two days. So let’s play big bank bingo and see how long it will take to hit these topics: | There was a large overlap between questions to the CBA and ANZ executives on the first two days. So let’s play big bank bingo and see how long it will take to hit these topics: |
| Coleman has started by asking about 43 financial planners dismissed between 2010 and 2015 and $14.5m compensation paid to NAB customers. | Coleman has started by asking about 43 financial planners dismissed between 2010 and 2015 and $14.5m compensation paid to NAB customers. |
| Updated | Updated |
| at 11.35pm BST | at 11.35pm BST |
| 11.30pm BST | 11.30pm BST |
| 23:30 | 23:30 |
| NAB chief executive Andrew Thorburn has quoted himself (evidence given to an earlier inquiry) in his opening address: | NAB chief executive Andrew Thorburn has quoted himself (evidence given to an earlier inquiry) in his opening address: |
| To our customers I acknowledge we have not always delivered as well as we could or should have, and we must do better. My responsibility is for improvement now, not later. | To our customers I acknowledge we have not always delivered as well as we could or should have, and we must do better. My responsibility is for improvement now, not later. |
| He addressed the area of remuneration and the need for customers to be confident that they receiving products that best suit their needs. | He addressed the area of remuneration and the need for customers to be confident that they receiving products that best suit their needs. |
| 11.26pm BST | 11.26pm BST |
| 23:26 | 23:26 |
| Andrew Thorburn has explained that the bank’s funding costs have fallen “but not as much as our lending rates”. | Andrew Thorburn has explained that the bank’s funding costs have fallen “but not as much as our lending rates”. |
| This has caused a reduction in bank margins, which he says has been in gradual decline for two decades. Thorburn blames more competition for term deposits and international wholesale funding which is set by global supply and demand, not the Australian cash rate. | This has caused a reduction in bank margins, which he says has been in gradual decline for two decades. Thorburn blames more competition for term deposits and international wholesale funding which is set by global supply and demand, not the Australian cash rate. |
| 11.23pm BST | 11.23pm BST |
| 23:23 | 23:23 |
| In his opening statement NAB chief executive Andrew Thorburn says that banking must be a profession based on trust and integrity. | In his opening statement NAB chief executive Andrew Thorburn says that banking must be a profession based on trust and integrity. |
| Thorburn’s formulation for describing the sub-optimalities in the industry is: | Thorburn’s formulation for describing the sub-optimalities in the industry is: |
| However there have been some issues in our industry, and at NAB, which we cannot be proud of. And I want to assure our customers and you that we are committed to facing into this so we can be a stronger bank and a stronger profession. | However there have been some issues in our industry, and at NAB, which we cannot be proud of. And I want to assure our customers and you that we are committed to facing into this so we can be a stronger bank and a stronger profession. |
| “Facing into” must be the corporate speak for “muck in and fix it”. Precisely what the consumer issues are is the third dot point Thorburn will cover in his 10 minute address. | “Facing into” must be the corporate speak for “muck in and fix it”. Precisely what the consumer issues are is the third dot point Thorburn will cover in his 10 minute address. |
| 11.18pm BST | 11.18pm BST |
| 23:18 | 23:18 |
| And we’re off. First up is NAB, the witnesses at the table are chief executive Andrew Thorburn, and Antony Cahill, chief operating officer. The live stream link is available here. | And we’re off. First up is NAB, the witnesses at the table are chief executive Andrew Thorburn, and Antony Cahill, chief operating officer. The live stream link is available here. |
| 11.08pm BST | 11.08pm BST |
| 23:08 | 23:08 |
| Labor is preparing the ground to demand further hearings and a royal commission. | Labor is preparing the ground to demand further hearings and a royal commission. |
| The party’s financial services spokeswoman, Katy Gallagher, told Radio National Drive on Wednesday she expected CEOs of Westpac and NAB to “defend the indefensible” – the same as execs from ANZ and CBA had, in her view. | The party’s financial services spokeswoman, Katy Gallagher, told Radio National Drive on Wednesday she expected CEOs of Westpac and NAB to “defend the indefensible” – the same as execs from ANZ and CBA had, in her view. |
| She repeated Labor’s arguments that the committee process was insufficient, citing the fact Timbercorp’s collapse only received eight minutes of questioning on Wednesday. | She repeated Labor’s arguments that the committee process was insufficient, citing the fact Timbercorp’s collapse only received eight minutes of questioning on Wednesday. |
| Asked if the politicians’ questioning was too soft, Gallagher turned that into another argument for a royal commission: | Asked if the politicians’ questioning was too soft, Gallagher turned that into another argument for a royal commission: |
| Again, there are areas, particularly on the more technical aspects where ... you would expect an expert would be much better … which is what a royal commission would allow. | Again, there are areas, particularly on the more technical aspects where ... you would expect an expert would be much better … which is what a royal commission would allow. |
| Pat Conroy, a committee member, told Sky News on Thursday a royal commission would grant time to hear from victims about how they have been affected by bank (mis)behaviour. | Pat Conroy, a committee member, told Sky News on Thursday a royal commission would grant time to hear from victims about how they have been affected by bank (mis)behaviour. |
| We have to win committee support to bring [bank executives] back – to be frank I’m cynical about whether the government-dominated committee will allow us to have more regular hearings. In the end this is window dressing to avoid a royal commission. | We have to win committee support to bring [bank executives] back – to be frank I’m cynical about whether the government-dominated committee will allow us to have more regular hearings. In the end this is window dressing to avoid a royal commission. |
| Updated | Updated |
| at 11.15pm BST | at 11.15pm BST |
| 10.56pm BST | 10.56pm BST |
| 22:56 | 22:56 |
| Greens to ask about political donations on day three of bank hearings | Greens to ask about political donations on day three of bank hearings |
| Welcome to the live blog for day three of committee hearings into the big four banks. Today we’ll hear from NAB and Westpac, kicking off at the same time as yesterday (9.15am AEDT). | Welcome to the live blog for day three of committee hearings into the big four banks. Today we’ll hear from NAB and Westpac, kicking off at the same time as yesterday (9.15am AEDT). |
| The new process for hearings into the banks requires them to occur at least annually so the banks may be off the hook for another year after today. | The new process for hearings into the banks requires them to occur at least annually so the banks may be off the hook for another year after today. |
| But Labor has already indicated it wants more time to grill the banks, calculating that if the Coalition-controlled committee refuses to grant extra hearings it will play into the opposition’s ongoing call for a royal commission. If it gets extra hearings, that’s more time to talk about bank misbehaviour. Win-win. | But Labor has already indicated it wants more time to grill the banks, calculating that if the Coalition-controlled committee refuses to grant extra hearings it will play into the opposition’s ongoing call for a royal commission. If it gets extra hearings, that’s more time to talk about bank misbehaviour. Win-win. |
| Andrew Thorburn, NAB’s chief executive, and Brian Hartzer, Westpac’s chief executive, will face the 10-member parliamentary committee today. | Andrew Thorburn, NAB’s chief executive, and Brian Hartzer, Westpac’s chief executive, will face the 10-member parliamentary committee today. |
| According to my colleague Gareth Hutchens’ preview, Labor has indicated that in Thursday’s hearing it will ask NAB why the corporate regulator has banned five of its staff from working in the industry and pressure Westpac to explain why it is generally the slowest of the big four banks to pass on the Reserve Bank’s interest rate cuts. | According to my colleague Gareth Hutchens’ preview, Labor has indicated that in Thursday’s hearing it will ask NAB why the corporate regulator has banned five of its staff from working in the industry and pressure Westpac to explain why it is generally the slowest of the big four banks to pass on the Reserve Bank’s interest rate cuts. |
| The Greens will ask about political donations, after NAB decided to stop giving them in May and ANZ indicated on Wednesday it was considering following its lead. | The Greens will ask about political donations, after NAB decided to stop giving them in May and ANZ indicated on Wednesday it was considering following its lead. |
| 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 | Updated |
| at 11.14pm BST | at 11.14pm BST |