20 October 2015,
Industry super fund-owned bank ME has welcomed today’s Government response to the Financial System Inquiry stating it will improve competitive neutrality and stability across Australia’s banking system.
ME CEO, Jamie McPhee, said:
“The recommendations will improve bank capital levels and competition and add to previous announcements and processes already initiated by the Australian Prudential Regulation Authority.
"We are particularly pleased to see the Government will take steps to reduce any implicit government guarantee and the perception that some banks are too big to fail, which has had the effect of giving the major banks significant competitive advantages in the cost of funding.
“Addressing too big to fail along with risk weight differences and capital levels will help maintain a diversified and healthy financial system.
“While we accept the Government does not yet see the need to legislate for mandatory participation in Comprehensive Credit Reporting, this may still be required as comprehensive data sharing is less likely to occur in highly concentrated banking markets such as Australia. The number of participants sharing comprehensive credit data is critical to the success of the regime.
“We commend Financial System Inquiry head, David Murray, and the other panel members, on their thoughtful considered analysis of the Australian financial system.
“ME is committed to working closely with the Government and agencies in the implementation and further consideration of the Murray review.”