Re­forms won’t please all banks: Aus­tralia

The Pak Banker - - Company& -

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

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