Reforms won’t please all banks: Australia
SYDNEY: The Australian government has signalled that its banking reforms will not please everyone in the industry, amid evidence banks are losing their dominance in lending to smaller rivals.
The Treasurer, Wayne Swan, said yesterday that within a week the government would unveil its long-awaited banking package, which will broaden lenders' funding sources and help consumers to shop around.
Official figures show the number of loans signed by nonbanks rose 17 per cent in the five months to October, while bank loans grew by 5 per cent.
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In October alone, the Bureau of Statistics said the number of non-bank loans increased by 12 per cent, compared with just 0.4 per cent for the banks. As the government prepares reforms to support a ''fifth pillar'' to compete with the big four banks, Mr Swan said there were no ''silver bullets'' to boost competition.
''Now, as is always the case, a lot of people have asked for a lot of things to be included in these reforms. And I am certain that no one will get all that they would like,'' he said.
However, indicating that the government is likely to support securitisation markets, he said mortgage-backed securities had been the most important force for competition in banking in the past 15 years.
Changes that enable people to swap banks more easily are also likely to be included in the government's package.
''We're working on measures to make it that little bit easier to walk down the street and get a better deal,'' he said. Stewart Oldfield, an analyst at EL&C Baillieu Stockbroking, said Mr Swan's speech suggested the reforms would support smaller banks but change was likely to be incremental. -PB News