In a speech at the National Press Club this week, ABA chief executive Anna Bligh said that while Australian banks had survived the GFC financially they have “not avoided the global reputational fallout from that crisis and the populist banking politics it brought with it”.
“As more and more people form the view that mainstream institutions have failed to protect them from the impacts of globalisation and technological change, the more distrustful they have become. The more they have sought the comfort and simplicity of populist ideas and movements,” Ms Bligh said.
“Here in Australia, this has been compounded by a number of serious instances of poor bank culture and poor customer outcomes that have hit the headlines and resonated with a sceptical public, regardless of their own personal experience with their own bank.”
Ms Bligh said that contrary to common belief, customers have a relatively positive view of their own banks. A recent survey found that 53 per cent of consumer participants reported they trust their own bank, while only 31 per cent trust the banking industry, she added.
Meanwhile, Ms Bligh said the behaviour of politicians who are “climbing over each other” to seem to be tough on banks is “dangerous for Australia’s financial stability”.
“In this political landscape, it is not surprising that persistent myths and criticisms about banks flourish,” she said.
Contrary to claims from politicians that banks are out to rip-off Australians, Ms Bligh said 80 per cent of bank profits are returned to shareholders.
Ms Bligh added that “Australia’s banks are Australia’s largest taxpayers – the industry paid more than $14 billion in tax last year alone”.
Banks also get a bad rap compared with non-banks, Ms Bligh said.
“Such is the venomous attention that banks now attract in the public arena that unregulated, unsupervised non-bank lenders, and other payday lenders, have flourished with almost no scrutiny or public acrimony,” she said.
“Yes, there is more to do and, in my view, more to do at a faster pace than banks are used to, but the leadership of our banks are intensely focused on the challenge.”
Consumers should trust a bank that charges over 20% interest on credit card debt ?
Maybe highway robbery is a trusted profession too.
And these are the partners of the FPA and AFA. How do we lift the public”s perception of financial advisers (and in-turn lower regulation and red tape) if the bodies that represent them are the same bodies that have these institutions as financial partners and these financial partners have such a poor perception.
yep the GFC caused the rogue banking advisers to place their clients into high risk investments without disclosure and without the clients authorization, it was the GFC that made these adviser falsify their documentation, it was the GFC that made these advisers transfer client monies into their own account.terrible terrible GFC. Oh Anna after all you are being paid to protect the banks and we will just have to subside with the dribble coming from your communication of thoughts.
Thanks for the politically correct spin Anna 🙄
Spoken by the new kid on the block and totally oblivious to the historical bad management of those associated with the financial services fiasco OR just diverting attention from to the facts. Whilst a few bad apples have been taken to task by the regulator, the management that supported or covered up these practices have yet to face consequences.Until till that happens, the industry will have issues, so Capt Bligh,
show true leadership.
Good points Anon. Let’s face it, she’s a pollie, she sees anything above 30% as a pass, anything above 50% as near perfect.
I don’t know whether the ABA are genius’s or have struck a nerve. Noting the onslaught against all things banking and retail super by ISN – ( full blown Fabian socialists) I find it really amusing that a former leftie politician has lifted the lid on the cynical manipulation of populism which from an ideological perspective is front and centre for those of the left. I take for example the Shorten push for a Bank Royal commission – nothing more than grandstanding – Hillarious – or has the world gone mad.
Having said that it is refreshing to finally hear the ABA push back on the trite messages of doom from the press. – If you repeat a lie often enough sooner or later it becomes reality for some. A tactic well used by Goebells. The major regret is the larger intso’s didn’t push back earlier in the piece – but I suspect there would have been commercial reasons for that.
Yes, there would be a reason for them not pushing back earlier – “banking” and “bank financial planning” are two separate issues which some respondents here are conflating due to IFA being an ‘advice’ publication. Ms Bligh appears to be talking about banking rather than financial planning, and while there are no doubt some poor customer treatment and outcomes in this arena, I’m happy to believe her stats that 53% are happy with their own bank. I’m happy with mine, both as a customer and as a shareholder. However, she (or the banks themselves) would be hard pressed to push back on the media’s exposure of the various financial planning scandals that have happened. For this there is no excuse, and the behaviour was driven be the performance expectations and remuneration structures of the banks. It is just a shame that only the planners bore the brunt of ASIC’s wrath, and not the management who were ultimately responsible.