- Commonwealth Bank reports almost $10 billion profit, but money laundering charges increase anti-bank sentiment
- About 5 years ago there was a proliferation of issues like this in the UK which resulted in large payout compensations and regulation changes
- The communities response will drive government regulatory changes
Alan Kohler worked with Stewart Oldfield at The AFR many years ago and now he’s running a business called Field Research which connects financial market participants with independent industry specialists. He basically brings institutional investors, fund managers, management teams and independent experts together on phone conferences.
Alan asked Stewart to conduct some of his phone conferences as interviews for us and here’s the first one on the topic of the week – banks.
Steve Weston was a senior executive with Barclays Bank in the UK and he saw what’s happening to CBA happen to banks over there about 5 years ago. He says it’s no longer enough to meet the letter of the law, banks now need to meet the spirit of the law to satisfy community expectations.
The conversation in boardrooms need to shift from focussing on profits and shareholders to putting more attention on customers. That change has taken place in the UK, and the benefits are flowing through to shareholders.
And Australia can also look forward to more new players in the banking sector. There’s only been one new banking license for a genuine new player in the past decade and it wasn’t a consumer bank. The changes proposed in our May 2017 budget were rolled out in 2013 in the UK and since then there’s been 15 new banks and almost double that number in applications being processed.
Steve Weston tells Stewart Oldfield that if we keep a close eye on the recent history of banking in the UK, we can see what lies ahead for banks in Australia.
Transcript Coming Soon