Libs tackle ASIC on bank appeal

SATURDAY, SEPTEMBER 14, 2019 themercury.com.au SUBSCRIPTIONS 1300 696 397 THE corporate watchdog says it is acting in the interests of the “broader economy” in appealing the Federal Court’s decision to throw out a responsible lending lawsuit against Westpac.

But federal MPs have questioned whether the regulator is creating uncertainty for borrowers and lenders by appealing the court’s ruling.

Appearing before a parliamentary committee yesterday, Australian Securities and Investments Commission chairman James Shipton said the watchdog was concerned lending standards could slip.

Mr Shipton said ASIC’s move to appeal the decision would be a lesser disruption to borrowers, lenders and the economy than the potential effects of the ruling itself.

Last month, the court dismissed ASIC’s landmark case against Westpac that alleged the bank approved home loans without properly checking if applicants could repay them.

Yesterday, Liberal MPs on the parliamentary joint committee on corporations and financial services argued the watchdog was creating more uncertainty. Committee chairman Senator James Paterson and MP Jason Falinski suggested ASIC’s appeal stoked concerns over credit availability and appeared to be based on insufficient evidence consumers had been affected by Westpac’s former loan regime.

Mr Shipton said ASIC believed there was a need to provide greater certainty, clarity and confidence to lenders. He said the appeal was “forwardlooking consumer protection”.

“We’re concerned that standards in responsible lending may very well drop,” he said.

ASIC did not intend to make it harder for lenders, prevent borrowers from accessing money, or put the brakes on the economy, he said.

Senator Paterson said consumers felt ASIC had “failed to protect them from bad practices”. “We have a collective responsibility to restore trust in our institutions,” he said.