Speaking at the 14th annual Wraps, Platforms & Masterfunds conference in the Hunter Valley last week, Dr Hewson – who is also the chairman of Shartru Capital – said that in hindsight, the banks may be regretting their decision to acquire wealth management divisions over the past decade without “doing it on a global basis”.
“There was this era in Australia where our banks wanted to become broad-based financial conglomerates providing all sorts of financial services,” Dr Hewson said. “Westpac bought BT, ANZ bought ING, CBA bought CFS etc.
“I suspect that there will be a push by the major banks to break down the process of owning [wealth businesses, and that they will] move out of funds management [and] on-sell them,” he predicted.
Dr Hewson also questioned whether former CBA CEO David Murray was an appropriate person to lead the FSI, given its task of examining these issues.
“I was fascinated that they found a climate-denying banker to head that review,” he said. “I don’t want to criticise David – I have the highest respect for him – [but] he was instrumental, I think, in the process whereby the CBA saw itself as a fund manager and a financial planner and a bank.”
The former opposition leader also asked whether we “ought to have” a royal commission into the “structure of funds management and superannuation management”, lamenting that the “industry funds have been given concessions”.
On the issue of FOFA, Dr Hewson said he accepted the government’s argument regarding the need to repeal elements of the legislation in order to reduce red tape for financial advisers and reduce the cost of advice, describing this motive as the “primary reason” behind the amendment agenda.
However, he added that serious problems remain for the industry in that many consumers “still feel they’re getting paper stuffers rather than advice – people who sell them their product rather than actually giving them objective financial advice”.
I would never buy anything offered to me by an FP advisory/sales person
John Hewson, also former Chairman of failed finance group Elderslie Finance which lost investors lots of $$$. Hardly makes him qualified to talk on finance. Also love how he doesn’t “like to criticise” David Murray right after calling him a climate denier. What an amazing smear. How many firms is John Hewson involved in that seeks to capitalise on “Climate Change”?
I agree with Mark C totally
If Dr Hewson’s “highest respect” comment is to be believed. And I for one dont take it seriously!
Particularly, the way Dr Hewson delivered his back hander! Dr Hewson’s comments, really do confirm he certainly wasn’t the right person to lead the liberal party anyway…
The only assessment I feel he got right is what the banks were and are about ongoing! None of which is any more than greed!
I dont think David Murray can afford to make a mistake. CAN HE?
Banks have paid millions to buy fund managers, insurers and licensees. The representatives are salesmen for the banks. That is why the APL of the licensees are loaded in favour of the parent. It will never be possible to beat this unless a system exists where qualified and trained advisers can hang out a shingle to start on ones own as easy as an accountant lawyer or doctor can. The whole license system stops what everyone says is needed.
I would have thought that Hewson’s Chairmanship of Elderslie Finance )into bankruptcy and oblivion) would have been an appropriate contre smack-down…
I also suspect that his reasoning, while sound, is expecting too much sense and too little greed from the banks. They’ll do it for as long as they can get away with it and they’ll lobby for the legislative changes (as they did successfully with FOFA watering down) that allow them to do so.
Without commenting on the underlying thematic, assuming the quote is accurate, Dr Hewson’s “highest respect” comment following an irrelevant (to the topic) casting of David Murray as a “climate-denying banker” is, at the very least, “disrespectful”, and redolent of political smear. Indeed, if climate change credentials were relevant to the topic, it would be just as pertinent to point out Dr Hewson’s “GST on cake” credentials. By the way, surely no one denies climate – perhaps they deny climate change.