Via The Australian:
A horde of Australia’s biggest financial institutions and superannuation funds have been forced by the prudential regulator to ram through an in-depth review of their culture and governance before the royal commission ends next year.
After copping heavy criticism over the course of Kenneth Hayne’s royal commission over a lack of enforcement in the financial sector, the Australian Prudential Regulation Authority has demanded Westpac, ANZ and National Australia Bank mimic the landmark cultural investigation of Commonwealth Bank the regulator launched late last year.
Along with the major banks, some of the nation’s biggest union and employer-backed super funds — such as the $40 billion Hostplus, $35bn fund Cbus and $50bn REST super fund — have also been asked by APRA to review their culture.
At the AFR it’s culture panic stations:
Westpac hauled each of its 40,000 bankers into urgent briefings by chief executive Brian Hartzer this week, who warned them to bring forward customer problems, as the bank tries to get on the front foot ahead of Friday’s royal commission interim report.
…It is expected to focus on a litany of failures including disregarding laws, procrastination reporting and fixing mistakes, a tendency to ride roughshod over vulnerable customers and prioritising making profits above all else.
Honestly, there is no more limp wet lettuce than this culture review salad. When we got a scathing review on CBA culture, APRA applied a sagging $1bn capital charge. It was virtually meaningless. That hints at the real issue here which is that regulators are the ones that need the culture review. They are soft, captured, in thrall to the regulated, often desperate to join them and in love with their housing bubble.
Forget culture. Focus on enforcement. We already have consumer credit protections. The problem is there is no willingness to govern them.
