Public hearing were conducted on 4 to 6 October.
News.com.au reporting on the Commonwealth Bank appearance on 4 October 2016:
Commonwealth Bank chief Ian Narev to face parliamentary inquiry into banking system…..
On Tuesday Mr Narev admitted an independent review found one in 10 customers received “inappropriate financial advice” from the bank.
Speaking to MPs, he said an independent report last week found of 8000 customers who asked for their financial advice to be reviewed, 6000 had been completed.
It found more than 10 per cent of those were given inappropriate advice. The bank had paid out $11 million in claims since its initial payout of $52 million several years ago.
Mr Narev defended the time it had taken to resolve the matter and said it would be wrapped up by the end of the year.
“We’ve gone back a large number of years in this program to statements of advice that go back prior to the global financial crisis,” he said. “So yes it has taken a period of time to do that but we’ve done it thoroughly, with independent oversight.”…
When asked by Labor’s Pat Conroy about whether there had been disciplinary consequences for CommInsure officers who rejected insurance claims from terminally ill people or refused to pay out life insurance, Mr Narev said there had been no terminations of employment.
“There are certainly individuals where we know enough about them that they’ve had some consequences related to remuneration but at this stage we have not had individuals terminated because of this because we’ve not seen the need to do that,” he said.
Independent committees within the bank will decide on disciplinary action after the review is completed.
Mr Narev said he expected there would be more cases of poor customer outcomes, but said this would be followed by more announcements regarding compensation due to customers…..
Power is a funny thing.
It shifts and flows, is both tangible and vague.
Often, it is most identifiable when it is missing.
As Ian Narev, the Commonwealth Bank CEO who received $12.3 million in pay last financial year, fronted the first of what are to be annual parliamentary committee hearings, who held the power was clear.
And it wasn't the government.
As far as Narev was concerned, everything he needed to say was said at his opening statement - the bank had not always done right by customers, but it was learning and changing and on the whole, its customers were "the most satisfied they've been".
It was all, he said, about being strong and fair. Strong banks equalled a strong economy. And that was almost an excuse for anything, even if they needed to work on being a little more fair.
Throughout the three-hour hearing, he often referred to what he said at the beginning, to the point where it became a mantra, no matter how many cases were mentioned.
On 5 October it was The Sydney Morning Herald which noticed what is probably a Brian Loughnane-inspired evidential trend:
He was very sorry for the issues within its wealth management division and its rural lending business, which saw ANZ foreclose on drought-stricken farmers.
He was very sorry for not supplying all the promised services to thousands of financial planning customers, resulting in $30 million compensation.
Very sorry for overcharging fees.
Very sorry for errors of a "reasonable magnitude" which saw more than 1.3 million customers within the OnePath financial advisory and life insurance arm suffer, including 1400 who had their superannuation directed to the wrong account.
These apologies are the opening moves.
But they were "mistakes", and the bank has since "put it right".
Processes have changed, systems have been put in place. There's no reason to push further, Mr Elliott implied. He's "proud of the culture of the bank", because when it's made aware of problems, it fixes them.
There's nothing more to see here.
Regarding the treatment
of customers, Mr Elliott said ANZ had “not always met the standards we set for
ourselves or that the community rightly expects of us”. He revealed the bank
had seen off 40 financial planners in the past year after the bank breached regulatory
rules.
Mr Elliott also admitted
the bank had “poorly managed” an incident when 1400 customers had
superannuation directed into the wrong account.
So how remiss had the
banks previously been in dealing with their indiscretions?
Let's take ANZ. Last
year it reported 45 breaches by its financial planners to the regulator.
That is one in 20 and in one year. But the year before there were only six
reported.
As
Pat Conroy noted, that was a 750 per cent increase in reported
breaches in the space of a year so either there was a massive jump in adviser
breaches or they had not been reported in the past.
Elliott had to admit the
latter was more likely.
Thus far the big banks have been all but laughing openly at parliament and the general public.
Commencing at 9.15am this morning it's NAB and Westpac's turn to pretend to care tuppence.
Hearing transcripts can be found here.
