That was the hope expressed during Westpac’s AGM held last Friday. It was interesting to hear from both Chairman and CEO on the upcoming Royal Commission.
Westpac chairman Lindsay Maxsted said
it is our hope that, ultimately, the newly announced royal commission will play a role in restoring trust, respect and confidence in Australia’s already strong financial system.
But, given the multiple inquiries which have run over recent months, Westpac consistently argued that further inquiries into the sector, including a royal commission, were unwarranted.
He did concede that there had been some instances where the banking sector had failed to meet customer expectations and banks had underestimated the subsequent backlash from customers, regulators and the government.
CEO Brian Hartzer said
We are embracing the royal commission as a way to finally draw a line in the sand on calls for inquiries.
and asserted that the banks have “been a political football for too long”.
That’s why we have now accepted the need for a royal commission to create certainty and confidence in our banking system.
So, it is worth noting that the scope is still being wrangled, and the process will take at least a year. It is also has a broad set of terms, spanning not just the banks. Yes, the announcement may ease the political debate, but that is not the end of the matter.
If past inquiries are any measure, there will be steady coverage as it progresses, and depending on the findings, it may, or may not rebuild confidence.
It seems to me that there can be no guarantees – and we still await the outcomes of the Productivity Commission on vertical integration, and ACCC on mortgage pricing.
So we think the outlook for the banks remains, at least, cloudy!
