Source: Australian Parliamentary Secretary to the Minister for Industry
At today’s Investor Roundtable I released the Council of Financial Regulators’ (CFR) review into small and medium‑sized bank competition and the government’s response to the review.
This review looked into ways to help create a more dynamic, diverse and resilient Australian banking sector.
A more diverse banking sector is good for competition, good for consumers, good for industry and good for the economy.
This is all about supporting smaller banks to drive stronger competition.
The review focused on the role small and medium sized banks play in providing competition in the sector and the regulatory and market trends affecting them. The CFR undertook the review in close consultation with the ACCC.
It makes nine recommendations for the Government and sets out nine actions for regulators.
The Government accepts in‑principle eight recommendations and welcomes all nine actions from regulators. We will seek feedback on the final recommendation for APRA to introduce a lighter touch framework for very small banks, accompanied by adjustments to the Financial Claims Scheme.
The Government will work with the CFR agencies and the ACCC on these actions and recommendations, including through further targeted consultation.
The release of the Review follows a broad consultation process, which involved 27 submissions, including 4 confidential submissions, as well as discussions with stakeholders from the banking industry, industry associations, other market participants and individuals.
The response to this review is another important part of the Government’s substantial competition policy agenda, including:
- Merger reform;
- Promoting competition in the financial system;
- Revitalising National Competition Policy with the States and Territories;
- Improving competition in the supermarket sector; and
- Cracking down on non‑compete clauses.
The full review is available on the Council of Financial Regulators website.