The Minister for Financial Services and Regulation
21 October 1998 - 26 November 2001
Interview with Georgie Gardner and Mark Beretta
Sunrise, Channel 7
6 March 2001
SUBJECT: Bank Report Recommendations
COMPERE: Well banks are used to being criticised, but this time it might be hard to ignore. A new report has raised serious questions about the way they do business. Financial Services Minister, Joe Hockey, says they must respond immediately.
Minister, good morning to you.
JOE HOCKEY: Good morning, Georgie.
COMPERE: Another report criticising banks. Why should we expect them to change this time?
JOE HOCKEY: Because the report was commissioned by the banks themselves and so, in a sense, they are the victim of their own hand here. And if they don't listen to the advice they're getting from their own appointee, Richard Viney, then they're sadly not going to take any other advice.
COMPERE: What are the key recommendations?
JOE HOCKEY: Well the key recommendations are what I would describe as a consumer's bill of rights when it comes to banking.
Don't lend a customer more money than they can afford to repay. Please discuss with the local community closing a bank branch before it's closed. Please ensure that a guarantor understands all their rights and obligations before they sign off on a guarantee.
COMPERE: One of those, sorry.
JOE HOCKEY: And these...
COMPERE: Sorry, keep going.
JOE HOCKEY: And these sorts of recommendations are in fact commonsense when it comes to banking. There's a whole host of other recommendations in relation to direct debit banking, electronic banking and basically, interface with customers.
COMPERE: All right, I just wanted to pick you up on one of those, recommending that the banks adopt a three-month protocol over branch closures. Isn't that just delaying the inevitable?
JOE HOCKEY: Well I don't think all wisdom emanates from Collins Street or Martin Place. I think that it would be a good thing for some of the banks to see what impact there is on the local community when they close a bank branch.
For example, in some of the bush towns where they have closed the last branch, the local community has come together with Bendigo Bank and formed a community bank and that bank has worked very well in a lot of small communities.
So I think the big banks have an opportunity to work with the local community and understand what their needs are before they decide to close a branch.
COMPERE: All right, turning to the economy now. Bad news in the latest building and jobs figures. Is the economy on the skids?
JOE HOCKEY: Well I think that's an exaggeration. I think in fact the economy continues to perform very well, despite what is an obvious downturn in the United States and a very sick Japan which is our largest trading partner. But as yet, the government continues to commit to strong economic growth. We can see no reason at this stage why that should change.
COMPERE: Joe Hockey, thanks for joining us on Sunrise.
JOE HOCKEY: Thank you, Georgie.