At the seventh round of hearings at the Hayne royal commission, senior counsel assisting Rowena Orr asked Mr Comyn about the key things CBA did not understand about the relationship between its advisers and their customers.
“Why didn’t CBA understand and appreciate the obligations attached to each of those relationships?” Ms Orr asked.
“I think we should have, Ms Orr,” Mr Comyn said.
“And why didn’t you? What do you put that down to, Mr Comyn?” Mr Orr said.
“Well, a culture of us not learning from issues of misconduct in the past,” Mr Comyn responded.
“What has become clear … when you look alongside the various case studies that I was asked to prepare as part of my witness statement, as you said, there are a number of recurring themes.
“And ultimately, that’s why I say we get into a period of ongoing remediation without actually fundamentally understanding the root cause in each of those matters and making demonstrable steps to ensure that they don’t reoccur.”
Ms Orr asked Mr Comyn if he learned anything about the 500 or so responses to a letter he sent to senior executives in attempting to address CBA’s internal culture.
“Everything from, I mean, a feeling, obviously, of disappointment, embarrassment, very much an acceptance of some of the key issues that were there, in terms of our inability to escalate/resolve conflict,” Mr Comyn said.
“Too much of a focus on things like collaboration, which had unfortunately become, I believe, a real weakness inside the organisation. Not enough capability in the management of non-financial risk, particularly in operational risk and in compliance.
“A focus on how they would lead a much more constructive and challenging raising of issues and also issue closure, and a lot of acceptance around the sorts of investment that will be required to ensure that we not only meet our compliance and legal obligations, but we’re also in line and exceed in many areas [of] the broader community and regulatory expectations, which I totally accept is some distance from where we are today.”
Ms Orr’s questioning also moved to what Mr Comyn believed was the hardest cause for CBA to fix.
“I think we may explore that in the context of AML/CTF (anti-money laundering/counter-terrorism financing), we have an enormous amount of work to do to improve our management of non-financial risk,” Mr Comyn responded.
“But as the chief executive, of course one of my primary issues is ensuring that we have a culture which has learned from the areas and issues of misconduct and we are a very different organisation for our customers going forward.
“And an exercise such as that which is, of course, a complex interplay of various factors, will take time. And there are many ways which I, with the support of my leadership team and, of course, working closely with the board, will need to make sure that that transition is successful.”
Mr Orr then asked Mr Comyn if management of non-financial risk will be the most difficult thing to fix.
“I actually think the larger change [is] around the culture of the organisation. That is, in some ways, harder to measure,” Mr Comyn said.
“And obviously the management of non-financial risk has been a clear failing in a number of different matters, but that is something I feel will be more readily observable and measurable.”
Removing comms on mortgage broking will kill some of the smaller players in the market, given they have little to no shopfront exposure. It will entrench the domination of the Big4 Banks & strangle competition. The banks cant cope with the number of people wanting loans now via their ever dwindling network of branches, how will they cope if they cut brokers out of the market?
Why is it that some things can be worked on a percentage basis – land rates, land tax, stamp duty on a property purchase, income tax, etc – yet commissions which are a percentage of the loan or premium cant be?
[quote=Anonymous]Bank Self Insure so woudl have no impact on your PI[/quote]
No they don’t . Definitely not for dealer group PI
THE RC MUST make a recommendation that every member of bank’s and insurer’s executive management team MUST enrol in a new degree that covers ethics, corporations law and every other BS subject that planners are being forced to do because of their pig behaviors in the past
Sounds like Matt is an expert at throwing people under the bus. Yesterday it was the Mortgage Brokers and today it was Ian Narev. Apparently everyone is to blame but him!
his chairman is even better, what a bunch of clowns. they haven’t got a clue what they are doing. total turds.
So Comyn was complicit in pillaging and then part of his solution is to introduce flat fees for mortgage brokers. When asked what value brokers offer on an ongoing basis he threw them under the bus. So nothing has changed. All the banks care about is themselves and fail to see the hypocrisy of making billions ( including their own salaries and bonuses ) for doing very little and then arguing that business that support them ( ie mortgage brokers ) should take a fee cut because they add very little and reducing broking costs will reduce costs for the customer. Outrageous.
In fairness the banks are the ones taking on the lending risk, not the broker. They deserve to earn more than brokers do for simply facilitating a loan with very little compliance risk.
I cant believe that the Bank’s dont allow brokers only access to their clients loan details like advisers get with super, investments & insurance products. How much better service would brokers be providing if they had access to real time info?
brokers are hamstrung by even the most basic things like that and even then, in only 20 years they have 53% market share, imagine if they had a platform where you could get live data.
the banks would have 1% market share, that’s why they don’t allow it. and now are trying to throw brokers into the same compliance regime as financial planners so the banks can regain that lost market share by regulation. because they have lost
sadly, it will probably happen because the lawmakers haven’t got a clue in fairness though the broker associations are a lot lot better than ours
Commonwealth Financial Planning (CFP), a very proud member of the FPA professional Partner Program. Sanctions, penalties issued to date…ZIP. With business partners like that, good luck getting the right outcome with FASEA. CFP payments are bundled up and reported as “members fees”.
Seems like FPA members are quite happy and complicit with their fellow “members” behaviour. It’s now “How to find a dodgy planner…well just look for the FPA logo and or brand.”
I’m sure a Medical Body getting funding from the Tobacco Industry and or the Sugar Industry also gets a great outcome for their members and Consumers….Not. and you wonder why we have FASEA.
As an adviser who uses CBA and CFS product I can tell you that they don’t care about anyone. They don’t care about staff or loyal supporters. Just profit and now risk mitigation.
you are exactly right! This is why I stopped using them 5 years ago and have been actively managing clients out of CBA/CFS/ and CommInsure product ever since! They are all disgusting but it is driven from the top!
The major bank failings have cost the industry massive increases in professional indemnity insurance premiums. There is the prospect that there will few IF ANY underwriters prepared to ‘swing’ at proposals next year! I am bracing myself for a massive lift in premiums despite never having a claim! Unfortunately the massive losses are amortised over the underwriting pool- this will need to be passed onto the clients.
Bank Self Insure so woudl have no impact on your PI
My PI broker was telling me that there are always firms willing to underwrite, it’ll just cost us an arm and a leg! I wonder if in the future we see boutique AFSL’s operating together and pooling resources to trim costs where they can – maybe even a self-insurance pool to payout smaller claims, heaven forbid we should have one, so that there is no need to claim on the PI policy. Thoughts?
[i]”Too much of a focus on things like collaboration, which had unfortunately become, I believe, a real weakness inside the organisation.”[/i]
Say what? Too much collaboration? How can that be a bad thing? Maybe Mr Comyn is confused with conceit, condescending, cavalier, confiscation, collusion, conniving and complicity. Take you pick.
It’s a culture about making money. If it’s not this it’ll be something else eg global financial crisis. There is always going to be a strong profit motive in anything done in financial services. Unless you have a personal relationship with the client ie as in running your own business where you own the relationship, the client is just a number and a means to make money. No regulation will ever overcome the desire to make money.
No, as macquarie bank have demonstrated you can make the reward system to simultaneously align with other equally important priorities, with deferred compensation, decisions are then taken with all elements in mind and reward is received when the impact of those decisions are fully realized
so in essence, these retail banks don’t know how to organise their REM.
all the smart ones go and work for macquarie, all the turds land in the retail banks, and then we have to deal with the leftover turds who are total retards
Why anyone is listening to a thing this bozo has to say is beyond me. Comyn was complicit and part of the culture he now claims brought it undone. Culture is established but more-so exemplified by the leaders of any organisation…want to change the culture Matt? Then sack every single one of the managers and leaders that have been part of the group over the last 10 years and you will see change…until then you’ve just the same people singing from a different (ass saving) hymn sheet…
This Bozo gets paid millions and will spend half a day with his fellow executives who also get paid millions to reflect on what happened ? Yet he took 5 minutes to throw mortgage brokers under the bus and state they get paid too much and they should move to a flat fee with no consideration for the costs of running their business? Why doesn’t he suggest we move to a flat fee on rather than a percentage profit margin of 2.4% on home loans ? This charade should now lead to a discussion on executive remuneration. They keep getting away with pay rises and treating their employees and business supporters with contempt. The gravy train should end and this is the trigger.
ha ha typical banker. makes the money, keeps it and then blames everyone else so funny. classic turd
How much more humiliating can this be for the public and the shareholders especially shareholders of the CBA
the turds are managing the company on behalf of their bosses the owners, and then decide to pay each other a bonus despite so many failings.
and the biggest turd, the chairman of the board, signs off on all this
I would be livid if I was a CBA shareholder. look at what your servants are doing to your money and company
I think you’ll find every bank will have a similar experience in the RC. As for those “humiliated” shareholders, well they are almost every super fund member in Australia.