No blood and gore on the floor

After a year of shame and grovelling apologies, the day of reckoning finally arrived. For those Australians hoping for structural separation of the banks, an overhaul of the regulators or heads on sticks, royal commissioner Kenneth Hayne’s verdict would have been disappointing. There was little blood and gore. It was more like a soft landing.

The royal commission spent a year listening to how many ways government regulators failed in their duty to regulate the financial services industry.

Customers were ripped off but the regulators had little or no appetite to use the tools at their disposal, preferring instead to do cosy deals with those they were meant to police.

Despite this, Hayne is giving them more powers and more work and has faith they will now actually do their job.

He recommends additional coregulation, which could be an excuse for more buck-passing.

In the case of the Australian Securities and Investments Commission (ASIC), there are some new commissioners who hopefully will start flexing their muscles, but the Australian Prudential Regulation Authority (APRA) has kept the same faces.

Hayne throws the book at some of the country’s biggest institutions, including the National Australia Bank, Commonwealth Bank, ANZ, AMP and Suncorp, for an array of crimes. There are 24 cases all up, which could end up including individuals. But he has referred the cases to ASIC or APRA for further investigation in the hope that this time they will do something.

The former High Court justice lays into NAB’s chief executive Andrew Thorburn and chairman

The royal commission tackled mortgage broking, financial advice and the A$44 billion life insurance industry – to a degree – and recommends insurance contracts be included in existing unfair contract term provisions to help protect customers from life insurers who fail to update medical definitions and other hidden nasties.

But he leaves it up to the ASIC to decide whether to ban commissions on life insurance.

Under the former Labor Government’s Future of Financial Advice legislation, which banned commissions on financial products, life insurance was carved out. It means trailing commissions and upfront commissions remain in force.