Will cooler heads prevail in 2019?
As industry professionals return to work, many will be reflecting on a tumultuous 2018 and asking themselves if the next 12 months will be more balanced.
Some won’t have taken a break at all and worked right through the holiday period. I did, and I happened to run into the senior executive of a listed mortgage broking and financial planning firm in North Sydney during the week between Christmas and New Year’s.
With the usually busy streets of the North Sydney CBD quiet and only a handful of coffee shops open, we both found ourselves operating at a slower pace. Neither he nor I were in a rush. Nor had our brains been bombarded by live news feeds of royal commissions, banned advisers, FASEA updates and remuneration reports.
Instead, our minds were free to reflect on 2018 and together we came to the conclusion that things got pretty intense over the past year. But we agreed that there are plenty of loose ends 2019 promises to conclude for the Australian financial services space like FASEA, the future of broker trail commissions, the direction of the property market, commissioner Hayne’s final report, a potential Labor government and housing tax policy changes.
Overall, we agreed that regulation had been the hottest ticket of 2018 and anyone with money in that racket would have done exceptionally well. Neither of us could figure out, however, how one might gain adequate exposure to the regulatory sector. But more regulation seemed like a sure bet.
The royal commission hearings somehow seem like a long time ago now. After 12 months of constant news coverage and analysis, the lack of it is a welcome change. That’s a bold statement for a financial services reporter, trust me.
The royal commission final report is due to be submitted to the Governor-General in less than a month, which presumably means commissioner Hayne is busy penning the thing right now. I wonder if time has worked on him the way it has on me and my industry chum; if the lack of reactionary news coverage has somewhat dulled the hyperbole and hysteria that peppered much of the financial press during 2018.
Time to reflect, with any luck, also means time to consider the broader consequences of new regulations that could stifle the financial services industry and ultimately lead to poor consumer outcomes.
Even if cooler heads do prevail among Hayne, ASIC, APRA, FASEA and the rest of the abbreviated brigade of red-tape bandits, they all essentially march to the beat of the government’s drum. And it is the government that will ultimately decide on the fate of the financial services industry.
If this year is anything like the last, we’re in for one hell of a ride.
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