This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.theguardian.com/australia-news/live/2016/oct/06/banking-inquiry-nab-and-westpac-bosses-face-questions-as-focus-turns-to-donations-live
The article has changed 15 times. There is an RSS feed of changes available.
| Version 10 | Version 11 |
|---|---|
| Banking inquiry: concept of passing on RBA cuts 'inaccurate', says Westpac chief – live | |
| (35 minutes later) | |
| 5.29am BST | |
| 05:29 | |
| Brian Hartzer has come up with the magic number of what an ATM transaction costs: 20 cents. He doesn’t have a figure for how much a transaction by a customer from another bank costs to hand. | |
| He said Westpac absorbs the cost of the ATM network for its customers, which explains why only customers of other banks pay a fee. The foreign fee “defrays the cost but comes nowhere near” paying for the whole network. | |
| It’s a “reasonable assumption” that the fee is higher than the marginal cost of the transaction by customers of other banks, Hartzer said. | |
| 5.24am BST | |
| 05:24 | |
| Matt Keogh has returned to asking about the UK’s new laws requiring individual accountability of executives. He suggests senior managers are responsible for training and systems around incorrect financial advice, not just the financial planners who give it. | |
| Westpac’s Brian Hartzer replies risk is inherent in investing and laws punishing innovation can have “unintended consequences”. He said: | |
| When they’ve been poorly advised, absolutely there should be consequences. But if people feel you can’t take risk because you’ll blame me and I’ll get a criminal penalty, a normal person would be much more reticent to give advice. | |
| 5.17am BST | |
| 05:17 | |
| Labor’s Matt Keogh has gone on the attack claiming no part of the $2.7m short term incentive Brian Hartzer is paid is for “customer satisfaction”. | |
| Hartzer said a net promoters’ score (customers’ willingness to recommend a product to others) is 10% of his score card and a number of other measures are about becoming a more service-oriented organisation such as technological innovation and people and culture. | |
| 5.12am BST | |
| 05:12 | |
| Treasurer consulted banks on tribunal before election | |
| MP Matt Keogh has asked about consultation on a banking tribunal and when the idea was first raised. | |
| Westpac’s Brian Hartzer said there was a meeting in April or May with the heads of the banks and the treasurer about resolution of complaints and the tribunal was raised there. | |
| I’ve never had a long conversation about the tribunal. I’m not really aware of the details of what is recommended. | |
| He said he supports consideration of gaps in accountability and improving the consumer complaints processes. | |
| Updated | |
| at 5.14am BST | |
| 4.55am BST | 4.55am BST |
| 04:55 | 04:55 |
| Chief executive Brian Hartzer said that Westpac has unconscious bias training for the top four layers of its management and will “continue to look at everything we can from the customer interface point of view to make sure women are very welcome”. | Chief executive Brian Hartzer said that Westpac has unconscious bias training for the top four layers of its management and will “continue to look at everything we can from the customer interface point of view to make sure women are very welcome”. |
| MP Julia Banks suggests the tribunal could mandate ethics and unconscious bias training to “provide benefits to consumers ... and ensure all employees across the bank are appropriately trained”. | MP Julia Banks suggests the tribunal could mandate ethics and unconscious bias training to “provide benefits to consumers ... and ensure all employees across the bank are appropriately trained”. |
| Hartzer has concerns with “more prescriptive regulation”. | Hartzer has concerns with “more prescriptive regulation”. |
| The more you prescribe what the bank does the more there are unintended consequences that have to be thought through carefully. | The more you prescribe what the bank does the more there are unintended consequences that have to be thought through carefully. |
| 4.50am BST | 4.50am BST |
| 04:50 | 04:50 |
| Liberal MP Julia Banks has asked about a bank tribunal and has added the details that it would be “under the auspices of Asic” and have “strong interventionist powers” to set benchmarks on sales. | Liberal MP Julia Banks has asked about a bank tribunal and has added the details that it would be “under the auspices of Asic” and have “strong interventionist powers” to set benchmarks on sales. |
| It’s interesting that none of the MPs have said explicitly that the tribunal’s role would be to grant compensation, as Liberal MP Warren Entsch has advocated. | It’s interesting that none of the MPs have said explicitly that the tribunal’s role would be to grant compensation, as Liberal MP Warren Entsch has advocated. |
| Westpac chief Brian Hartzer says first, the bank tries to ensure customers don’t complain; second, it has a process to deal with complaints internally; then third, it is introducing an external customer advocate. | Westpac chief Brian Hartzer says first, the bank tries to ensure customers don’t complain; second, it has a process to deal with complaints internally; then third, it is introducing an external customer advocate. |
| There may be occasions that people say they’re still not happy. It’s entirely appropriate to look at that appeal framework. I don’t have a strong view about whether that’s a tribunal or something else. | There may be occasions that people say they’re still not happy. It’s entirely appropriate to look at that appeal framework. I don’t have a strong view about whether that’s a tribunal or something else. |
| 4.32am BST | 4.32am BST |
| 04:32 | 04:32 |
| Concept of passing on RBA rate cuts is "inaccurate": Westpac chief | Concept of passing on RBA rate cuts is "inaccurate": Westpac chief |
| Matt Thistlethwaite asks about “rockets and feathers” - the theory that banks jack up rates quicker than they take them down in reaction to cash rate changes. He suggests Westpac is “the worst at passing on” rate cuts. | Matt Thistlethwaite asks about “rockets and feathers” - the theory that banks jack up rates quicker than they take them down in reaction to cash rate changes. He suggests Westpac is “the worst at passing on” rate cuts. |
| In August 2016, Westpac took 20 days to reduce its rates. Thistlethwaite suggests this netted Westpac $28.2m in profit | In August 2016, Westpac took 20 days to reduce its rates. Thistlethwaite suggests this netted Westpac $28.2m in profit |
| Westpac chief Brian Hartzer said mortgages are funded by a mix of long term savings from term deposits and offshore borrowing from bonds, not just the cash rate. | Westpac chief Brian Hartzer said mortgages are funded by a mix of long term savings from term deposits and offshore borrowing from bonds, not just the cash rate. |
| If this was causing a significant distortion in our margins then you would see it in the net interest margin of the bank - and as I said in my opening statement our net interest margin has been coming down over time. | If this was causing a significant distortion in our margins then you would see it in the net interest margin of the bank - and as I said in my opening statement our net interest margin has been coming down over time. |
| The concept of “passing on” a cash rate reduction is “essentially an inaccurate statement”, he said. | The concept of “passing on” a cash rate reduction is “essentially an inaccurate statement”, he said. |
| Updated | Updated |
| at 4.32am BST | at 4.32am BST |
| 4.25am BST | 4.25am BST |
| 04:25 | 04:25 |
| MP Matt Thistlethwaite said personal bankers have goals of two insurance sales a week, two home loan referrals, two wealth referrals, one BT or life insurance protection sale and other targets. | MP Matt Thistlethwaite said personal bankers have goals of two insurance sales a week, two home loan referrals, two wealth referrals, one BT or life insurance protection sale and other targets. |
| Westpac chief Brian Hartzer replied: | Westpac chief Brian Hartzer replied: |
| You’re referring there to a personal banker whose job is to have conversations with customers all day... | You’re referring there to a personal banker whose job is to have conversations with customers all day... |
| Out of that we expect we would find opportunities - for mortgages, for insurance. We know for a fact most Australians are under-insured. | Out of that we expect we would find opportunities - for mortgages, for insurance. We know for a fact most Australians are under-insured. |
| He said referrals arise out of consideration of customers’ needs and products recommended are in the best interests of customers. | He said referrals arise out of consideration of customers’ needs and products recommended are in the best interests of customers. |
| The numbers are the measure of an expectation about what an employee having “high quality conversations” will achieve. | The numbers are the measure of an expectation about what an employee having “high quality conversations” will achieve. |
| Asked why the bank doesn’t wait for customers to ask for the products if they need them, Hartzer suggests some are “in denial”, “confused” or don’t have good financial literacy. | Asked why the bank doesn’t wait for customers to ask for the products if they need them, Hartzer suggests some are “in denial”, “confused” or don’t have good financial literacy. |
| We do not condone selling products to people that they don’t need ... We have made clear that is not what we are asking employees to do. | We do not condone selling products to people that they don’t need ... We have made clear that is not what we are asking employees to do. |
| 4.14am BST | 4.14am BST |
| 04:14 | 04:14 |
| Brian Hartzer says Westpac “probably sources some external data sources” when asked if it uses information from third parties to sell products to its customers, but their own transaction history is the most valuable source when considering their banking needs. | Brian Hartzer says Westpac “probably sources some external data sources” when asked if it uses information from third parties to sell products to its customers, but their own transaction history is the most valuable source when considering their banking needs. |
| He said Westpac spotting a transaction to pay off a credit card with a competitor and offering that customer a credit card would be a good example of “healthy competition”. | He said Westpac spotting a transaction to pay off a credit card with a competitor and offering that customer a credit card would be a good example of “healthy competition”. |
| Customers can tick a box to opt out of such offers, he said. | Customers can tick a box to opt out of such offers, he said. |
| Updated | Updated |
| at 4.15am BST | at 4.15am BST |
| 4.09am BST | 4.09am BST |
| 04:09 | 04:09 |
| Westpac chief Brian Hartzer said in the parts of the business that still have performance pay that bonuses for performance are less than 5% of a personal banker’s income and less than 2% for a teller. | Westpac chief Brian Hartzer said in the parts of the business that still have performance pay that bonuses for performance are less than 5% of a personal banker’s income and less than 2% for a teller. |
| Updated | Updated |
| at 4.37am BST | at 4.37am BST |
| 4.03am BST | 4.03am BST |
| 04:03 | 04:03 |
| Matt Thistlethwaite has asked about refunds by Westpac of $9.2m in bank fees and $22m in credit card transaction fees. | Matt Thistlethwaite has asked about refunds by Westpac of $9.2m in bank fees and $22m in credit card transaction fees. |
| The chief executive says a large number of accounts were affected, including failing to give 150,000 students a waiver on fees and charging 800,000 accounts foreign transaction fees when they shopped on overseas websites. | The chief executive says a large number of accounts were affected, including failing to give 150,000 students a waiver on fees and charging 800,000 accounts foreign transaction fees when they shopped on overseas websites. |
| 3.58am BST | 3.58am BST |
| 03:58 | 03:58 |
| Financial planner bodycount at Westpac is 22 in the last 6 years | Financial planner bodycount at Westpac is 22 in the last 6 years |
| Westpac chief executive, Brian Hartzer, said that in the last six years 22 financial planners have been referred to Asic and all of them are no longer at the bank after being sacked or resigning. | Westpac chief executive, Brian Hartzer, said that in the last six years 22 financial planners have been referred to Asic and all of them are no longer at the bank after being sacked or resigning. |
| Hartzer said the bank audits all the files of planners referred to Asic, notifies all their clients and makes redress where appropriate. | Hartzer said the bank audits all the files of planners referred to Asic, notifies all their clients and makes redress where appropriate. |
| 3.54am BST | 3.54am BST |
| 03:54 | 03:54 |
| The Westpac chief executive says mortgages that track cash rate moves “appear attractive” and nothing stops them being offered. But rate-tracker mortgages are “fraught with risk” when the cost of funds spikes and a bank is not allowed to reprice its interest rates. | The Westpac chief executive says mortgages that track cash rate moves “appear attractive” and nothing stops them being offered. But rate-tracker mortgages are “fraught with risk” when the cost of funds spikes and a bank is not allowed to reprice its interest rates. |
| Quizzed as to why banks in other markets offer them but not Australia, Hartzer says that other markets like the UK have deeper domestic capital markets and rely less on global funds to provide mortgages. | Quizzed as to why banks in other markets offer them but not Australia, Hartzer says that other markets like the UK have deeper domestic capital markets and rely less on global funds to provide mortgages. |
| 3.43am BST | 3.43am BST |
| 03:43 | 03:43 |
| Westpac chief executive, Brian Hartzer, tells the committee it wrote submissions to the Productivity Commission in favour of data portability to enhance competition. | Westpac chief executive, Brian Hartzer, tells the committee it wrote submissions to the Productivity Commission in favour of data portability to enhance competition. |
| He declines to take a free kick offered to him by David Coleman about why the other big four banks resisted the idea. | He declines to take a free kick offered to him by David Coleman about why the other big four banks resisted the idea. |
| 3.41am BST | 3.41am BST |
| 03:41 | 03:41 |
| What are the odds? | What are the odds? |
| .@Westpac CFO Peter King having a rough start before House Economics Committee. He's shown up wearing the same tie as chair @DavidColemanMP. | .@Westpac CFO Peter King having a rough start before House Economics Committee. He's shown up wearing the same tie as chair @DavidColemanMP. |
| Who wore it best? House Economics Committee chair David Coleman and Westpac CFO Peter King. #auspol pic.twitter.com/5yGovU8Jas | Who wore it best? House Economics Committee chair David Coleman and Westpac CFO Peter King. #auspol pic.twitter.com/5yGovU8Jas |
| Updated | Updated |
| at 4.04am BST | at 4.04am BST |