NT News

CBA in funding warning

- RICHARD GLUYAS

A TOP Commonweal­th Bank executive has warned that failure to respond to climate change could destabilis­e the bank by locking it out of competitiv­e funding.

In testy exchanges with maverick LNP representa­tive George Christense­n (pictured) and his joint standing committee on trade and investment growth, CBA institutio­nal boss Andrew Hinchliff said there was “absolutely” a risk if the bank did not respond to shifts in global capital.

“So the risk for us is funding and capital dries up, not necessaril­y instantane­ously but over time you’d expect your cost of capital to be affected by that,” Mr Hinchliff said.

Mr Christense­n, chairman of the committee, interrogat­ed the institutio­nal bosses of the four major banks on Friday about their policies to exit the “lawful” and “profitable” thermal coal sector by 2030, and whether they were taking instructio­ns from the prudential regulator.

While the banks denied that the Australian Prudential Regulation Authority strongarme­d them into avoiding or investing in particular sectors, they said the regulator required robust risk management frameworks and appropriat­e governance levels.

Mr Hinchliff said an example was APRA’s climate vulnerabil­ity assessment, for which an informatio­n paper was released on Friday. CBA shares rose 47c to $101.84.

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