Bank reforms gaining traction, independent expert finds

Sydney, 20 July 2017: The Australian Bankers’ Association has welcomed the latest progress report from former auditor-general Mr Ian McPhee AO PSM which found the industry’s reform program is starting to gain traction and deliver tangible benefits to customers.

Mr McPhee said banks had continued to make good progress delivering reforms, with many of the initiatives now in the implementation phase. He said it was the first quarter ‘where the positive impact flowing to individual customers through some of the initiatives is clearly visible’, particularly in relation to newly appointed customer advocates.

Overall, those initiatives where banks have control over design and implementation remain on track to be delivered within anticipated timeframes, while measures requiring government or regulatory involvement may take longer.

Significant achievements in the quarter to July 2017 included:

• The start of the redraft of the Code of Banking Practice with the new Code to be finalised by December 2017.
• Twenty member banks have appointed customer advocates who are already assisting customers to resolve issues and proactively improving customer outcomes.
• Major banks have implemented the industry’s conduct background check protocol to stop individuals with a poor conduct record moving around banks undetected. Non-major banks have committed to implement the protocol by 1 October 2017.
• Meetings with lenders, mortgage brokers and aggregators to progress potential self-regulatory responses to change remuneration and governance practices in the mortgage industry.

ABA Executive Director – Retail Policy, Diane Tate, said she was pleased that implementation of the reforms remained on track and that Mr McPhee’s report included examples of how reforms were starting to benefit customers.

“If the industry’s reform program is to be successful, bank customers must be able to experience improvements themselves,” she said.

“Mr McPhee’s latest progress report includes case studies from individual banks and other examples of how reform initiatives are now starting to deliver benefits to customers.

“It is important that the industry increases awareness with customers and the broader community about how they will benefit from the improvements banks are making, and also that we’re able to measure success effectively,” she said.

Ms Tate welcomed Mr McPhee’s acknowledgement of the ongoing commitment of bank CEOs to deliver the industry initiatives ‘because they are good for cus tomers and good for business’.

“It is encouraging that we’re seeing early signs of customers benefiting from these changes, but banks realise there is much more work to be done,” Ms Tate said.

ENDSContact: Stephanie Arena 0477 470 677 or Nic Frankham 0435 963 913