Day 338: 'Bank bashing is not an end unto itself'
An introductory weekday newsletter from Schwartz Media. Counting the days since the banking royal commission was established.
Good afternoon and welcome to day 338.
Today in summary: the government stumps up A$51.5 million for the Federal Court and the DPP to help prosecute criminal misconduct by banks; the Greens label yesterday’s senate committee report on banking a “joke”, and in a fortnight’s time get ready to talk about that $2,000 blender, the Thermomix.
-- Charis
Current banker panic level: 😱
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The federal government will provide an additional A$51.5 million to the Commonwealth Director of Public Prosecutions and the Federal Court of Australia to enable further prosecutions of criminal misconduct by banks and to “ensure civil claims are dealt with effectively and expeditiously”. The funding sounds generous, but for the DPP will be spread over eight years, and for the Federal Court over four. It comes on the back of A$70 million in additional funding for ASIC.
The government has also asked the Attorney-General’s Department to conduct a review of whether the Federal Court’s criminal jurisdiction should be expanded to include corporate crime.
Treasurer Josh Frydenberg said:
“The Hayne Royal Commission made a scathing assessment of the culture and lack of compliance in the financial services sector and this readies the Commonwealth DPP and the Federal Court for the work ahead.”
The decision by the Senate Economics References Committee to leave recommendations on improving regulations in the financial system to the Hayne royal commission has been labeled a “joke” by Greens Senator Peter Whish-Wilson. He said the report was disrespectful to those who took the time to participate in the inquiry and reflected poorly on the Australian Senate and the otherwise well respected committee system,.
“Bank bashing is not an end unto itself. Policy reform is the goal. And this Chair’s report fails terribly by that measure.”
In a bizarre and unexpected twist in the Hayne royal commission, pundits are flagging questioning by Commissioner Hayne in coming weeks on a $2,000 Thermomix that reportedly came to be paid for by NAB. Fairfax is reporting the royal commission had sought information about executive events firm the Human Group's dealings with NAB and “is likely to inquire into what benefits the events company may have tried to provide to bank staff, and whether these benefits were disclosed”.
Today’s burn prize: NAB CEO Andrew Thorburn
🔥🔥🔥
“Mr Thorburn's pay reduction means he is no longer the highest-paid NAB executive, with chief technology officer Patrick Wright earning $4.4 million.”
ABC business reporter Peter Ryan on that feeling you get when you realise the tech team is on more money than you. And you’re the CEO.
The Commentariat
Of the more than 100 bank, insurance and superannuation employees that have appeared at the Hayne commission so far, few have come out looking better than when they went in, writes the AFR’s James Frost.
“Sixteen executives and board have lost their jobs as a direct result of appearances or developments flowing from the hearings. At least one has not returned to work and remains on stress leave. Two companies have been shuttered. One financial services licence has been revoked. And we don't even have the final report.”
The big four bank CEO’s may be patting themselves on the back for their performance at the recent parliamentary banking inquiry, writes the AFR’s Karen Maley, but she says they’ll need to sharpen their lines before they front up before Commissioner Hayne.
“It's unlikely that either the formidable Commissioner Hayne, or his fiercely intelligent lieutenants, will be easily persuaded as to the magnitude of the changes that bank bosses claim to have made to their sprawling corporate empires.
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