Bank­ing Royal Com­mis­sion and what it means to you

What’s be­hind the shock­ing rev­e­la­tions com­ing out of this in­quiry?

Monthly Chronicle - - Business & Personal Finance - Raj Lad­her

What is it: The Bank­ing Royal Com­mis­sion was called at the end of 2017 to in­ves­ti­gate any mis­con­duct into the bank­ing, su­per­an­nu­a­tion and fi­nan­cial ser­vices in­dus­try, with the fi­nal re­port to be com­pleted by 1st Fe­bru­ary 2019. Af­ter ini­tial protes­ta­tions by the Prime Min­is­ter, the Com­mis­sion was set up af­ter pres­sure from whistle­blow­ers, some Par­lia­men­tar­i­ans and the pub­lic.

Find­ings so far: There have been a num­ber of ma­jor cases of mis­con­duct, with CBA ad­mit­ting some of their fi­nan­cial plan­ners charg­ing fees to de­ceased clients, NAB know­ing about staff mem­bers fal­si­fy­ing cus­tomer sig­na­tures, AMP ad­mit­ting to ly­ing to the reg­u­la­tor which forced the Chief Ex­ec­u­tive and Chair­man to step down, and even ASIC the reg­u­la­tor con­firm­ing not all com­plaints of fi­nanciers are be­ing in­ves­ti­gated.

What does it mean for you?: In the long term, hope­fully a more ro­bust and trans­par­ent bank­ing in­dus­try. In the short term how­ever, there may be added scrutiny on ob­tain­ing fi­nance as the banks seem to al­ready take a more cau­tious ap­proach.

Mov­ing for­ward: With all the bad news com­ing out of the Com­mis­sion, nat­u­rally it will be hard to trust pro­fes­sion­als within the in­dus­try. How­ever like all in­dus­tries, there are good and bad ap­ples. I am con­fi­dent that good sto­ries out­weigh all the ex­am­ples of bad prac­tice com­ing out.

The Com­mis­sion wasn’t called to re­duce con­fi­dence in hon­est and knowl­edge­able in­dus­try pro­fes­sion­als, but more to iden­tify weak­nesses in the in­dus­try. The Aus­tralian bank­ing in­dus­try is still one of the strong­est on the globe with most in­dus­try pro­fes­sion­als very com­pe­tent in work­ing in the best in­ter­ests of its cus­tomers.

Raj Lad­her from To­mor­row Fi­nance is a mort­gage ex­pert with over 11 years' ex­pe­ri­ence both in the UK and Aus­tralian mort­gage mar­kets. Ac­cred­ited with the Mort­gage and Fi­nance As­so­ci­a­tion of Aus­tralia (MFAA) and ac­cess to nu­mer­ous lenders, Raj spe­cialises in all types of mort­gages, from first home­own­ers to in­vestors in­creas­ing their port­fo­lio. For more, email raj@to­mor­row­fi­nance.com. au

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