The head of ANZ has admitted that some of the bank’s customers have not been advised that their financial advisers have been banned by the Australian Securities and Investments Commission.
Shayne Elliott, the ANZ chief executive, has also revealed the ANZ board is now considering ending political donations, just as National Australia Bank has done.
Appearing on the second day of the Turnbull government’s bank hearings in Canberra, Elliott used his opening statement to apologise to ANZ customers, saying the bank had not always met the standards it set for itself.
On credit cards, he conceded that the headline interest rate on ANZ credit cards may be too high, and he was open to restructuring.
He said he was also open to the idea of a “one-stop shop” bank tribunal for customers with serious complaints, joining the Commonwealth Bank chief executive, Ian Narev, who had expressed a similar sentiment during Tuesday’s bank hearing.
But he appeared to be under more pressure than Narev had been the day before.
Narev had emerged unfazed from the first day of bank hearings on Tuesday, having answered all of his questions easily.
Elliott spent much more time defending his bank’s actions and explaining why customers had been let down.
At one stage he was asked by the Labor MP Matt Thistlethwaite about one financial planner who had been banned for 10 years for falsifying documents, and about another who was contesting a one-year ban after resigning from the bank.
Elliot admitted that the clients of those advisers had not been told they’d been banned by Asic.
“We have not, to date, specifically advised those clients,” Elliot replied. “We are going to. There is a gap in our process, we should [advise the clients].”
When asked about Asic’s claim that ANZ had engaged in alleged unconscionable conduct and manipulating the bank bill swap rate between 2010 and 2012, Elliot defended the bank.
He said two employees had been fired for violating the bank’s code of conduct but the rest had been reinstated after initially being stood down.
He also tried to explain the numerous breaches that had occurred at ANZ between 2013-15 – including one in which customers’ superannuation money was allocated to wrong the accounts for up to 12 months.
Later in the hearing the Greens MP Adam Bandt asked Elliott how ANZ justified to shareholders donating more than $1.6m to the Coalition and Labor between 2004-2005 and 2014-15.
“That’s a very good question,” Elliott said. “We justify it on the basis that we are supporting the democratic process in the country.”
Bandt asked him if ANZ had plans to stop making political donations. “We are having discussions at our board about the role of political donations and what our position is on that,” Elliot replied.
NAB has decided to stop making political donations to all levels of government and to political entities.
According to its policy statement on political donations, the bank’s board of directors “resolved in May 2016 that the making of any political donations would cease with immediate effect”.
It says the board recognises the bank has an important role to play in Australia’s political process, and in the development and promotion of policy, and it now believes that can be better achieved by avoiding making political donations altogether.
“From May 2016 NAB ceased making political donations at the commonwealth, state and local government level,” to document says.
It means the federal Liberal, National and Labor parties will lose a crucial source of political funding.
The prime minister, Malcolm Turnbull, defended his decision on Wednesday not to hold a royal commission, telling 612 radio in Brisbane that annual bank hearings would be a good way to hold banks to account.
“I’ve seen it reported in the press that this was designed to stave off a royal commission, that’s nonsense,” Turnbull said. “I understand the banking industry and I understand what’s wrong with it.
“I understand that what it needs is greater accountability and transparency. So what we’ve done is ensure that the banks go up before that committee at least once a year – it could be two or three times a year, it’s up to the committee.”
