The Big 4 have been publicly signalling their intentions for some time now, via statements from their PR people, in-house economists and their CEOs. These aren’t just signals to the public, or to the markets. These are signals to each other. Like Mr Samuel I’m not suggesting anything technically illegal here, but you don’t need to formally agree to fix prices to limit competition.

These signals received from each other through the public domain will very definitely impact the banks’ plans. Most banking observers will clearly remember the backlash from Westpac’s “almost double” rate rise in December 2009 (compounded by their banana smoothies analogy). And prior to that, July 2009 when Commonwealth Bank made a 10bp increase without any Reserve Bank moves and was berated by everyone from the PM down. But the banks will also recall April 2009 when all 4 majors failed to pass on the full RBA rate cuts. And they know that, if they act together or reasonably closely together, then the public reaction is a more generic bank bashing and not a PR nightmare targeted at any one of them. So these “I will if you will” signals are playing a very real part in the pricing deliberations within the banks. And that should concern anyone interested in genuine competition.

Competition is also the missing ingredient in the argument between the banks and everyone else about whether funding costs have genuinely risen. The point is not whether costs have gone up, but whether it necessarily follows that prices must go up too. The tone of the Big 4′s statements implies that it is their natural right to extract any cost increases directly from their customers. Of course it is a sensible business decision to attempt to recoup increased costs. But it is not automatic that it must be done. APRA and the RBA tell us that the banks are strong, so it is not necessary that they maintain margins for reasons of security. They are maintaining margins because they choose to and because they can. There is not enough pressure from customers and competitors to force them to make other choices. It is an oligopoly.

But it is more than that. It is an oligopoly that enjoys significant protection, via its central place in the economy and the benefits that flow from it – eg government guarantee on deposits in the GFC. There are other industries with the privilege of being protected oligopolies, but where the players are not allowed to exercise this kind of power without some restriction. Energy companies and health insurers spring immediately to mind: both of these have their pricing decisions heavily regulated. Perhaps the big banks should consider their position of privilege and treat it with respect, or they may find themselves subject to pricing restrictions of some kind. The Greens already have several policies relating to bank pricing regulation, on ATM fees for example. They are in a position to wield some influence. And wouldn’t the voters in the mortgage-belt marginal seats love it!

Customers do notice, and they do care. Mozo’s customer rate and review system saw a distinct reaction to the home loan rate rises in December 2009: Westpac’s interest rates went up 45bp and their customer ratings nosedived, ANZ and Commbank upped rates in the mid-30s and saw no real change to customer satisfaction, and NAB stuck to the RBA’s 25bp rise and extracted a small gain in how customers saw them. Homeowners may not have as many alternatives as they once did, and switching providers is still very time consuming, but there are cheaper providers. And the more the Big Banks erode their customers’ satisfaction, the more vulnerable they will become to challengers or regulators or both.

Compare home loans at mozo.com.au

The ANZ Extras Package is a standard ANZ access account which, as the name suggests, comes with a range of extras for an increased monthly fee of $18. What does this $18 get you? Well, apart from a standard day-to-day bank account, the package gives you a range of bonuses and benefits you’d normally associate with a credit card or a home loan package.

The first of these is a slew of instant shopping and dining discounts as well as ticket and travel offers, similar to the kind of thing we’ve seen in credit cards over the past few years. Another key feature is 24 hour roadside assistance. Considering the usual annual cost of this service is approx $99, its addition could help justify forking out the account’s monthly fee.

The Extras Package also comes with mobile phone, domestic travel and accidental death insurance. The mobile phone cover is particularly unique and as it usually costs about $6 a month when taken with your mobile provider, it proves a pretty handy saving. Whilst all this cover is useful, I must say it’s odd that there isn’t some level of purchase protection or extended warranty as they would seem to be a better fit for a day-to-day transaction account.

On the financial side, you get free access to a monthly overdraft facility of up to $1000. You also get 0.2% bonus interest on an ANZ Online Saver account as well as waiver on an ANZ First credit card’s $30 annual fee. Like ANZ’s standard account, the extras package also comes with a Visa debit card.

The question is whether all the ‘extras’ are worth the $18 monthly fee. Financially, the overdraft facility is handy, but there are far better savings and credit card products out there even when you add the discounts into the equation. Also, if you already have a home loan package or credit card, you’ll already have access to most of the benefits available. However, for those without either, ANZ’s extras package has a host of benefits that depending on circumstance, could save you a bit of money and make things a little more convenient. It may not be for everyone, but nonetheless, it’s heartening to see a bank try something new.

Go to mozo to compare all bank accounts

Since Origin is about representing your state, community and people, we’ve decided to use what consumers have said about their banks hailing from each particular state to create an overall picture. So using the 30,000 bank reviews you’ve submitted, it’s time for Mozo’s annual ‘Rate of Origin’. State against state. Rate against rate.

With 7371 reviews behind them and big players like Westpac, Macquarie and St. George as well as no less than 4 credit unions on our list of the top 10 Australian banks in the side, NSW comes in as strong favourites. As always, Queensland are the underdogs, conceding a significant numerical advantage in both number of reviews (2416) and number of providers (10 to NSW’s 15). They’re led by Queensland stalwarts like Suncorp, Bank of Queensland and their sole representative in our top 10, CUA.

With the NSW camp already shattered and in turmoil after losing their fifth straight origin series, it will come as another body blow to the state and their footballers that NSW is getting dusted not only on the field but also in their wallets. NSW banks put up a solid if unspectacular average overall rating of 6.91, led by strong performances by Teachers Credit Union and the Greater Building Society. However, with old hands Suncorp and Bank of Queensland ably steering them round the park and strong efforts from CUA and Heritage Building Society, the banana benders have stormed home with an overall rating of 7.34 to claim the Origin title.

The real difference between the sides was the abject performance of Westpac, whose rating of 6.7 was the catalyst to NSW’s demise. If you remove Westpac from the equation, NSW’s rating rises to 7.25, a mere drop goal away from victory. NSW will be looking for Westpac to pick up their game over the next year to avoid the pain and humiliation of another Rate of Origin defeat.

So as the dust settles and the xxxx’s are cracked in bank head offices around Brisbane and wider Queensland after another fiery clash between these two interstate rivals, I implore all Origin fans out there to get behind your state and rate your bank to give your state a shot at Origin glory next year!

So Mozo is introducing the country’s first bank-emergency response unit: the Mozo Rate Chasers. This crack team of field experts report back from the front line of finances to get you the latest on banking conditions: the lowest home loans amid a surge of rate rises; the best credit card deals as new providers blow in; the Noah’s Ark of term deposits as the savings flood sets in.

And as conditions intensify, Mozo HQ has upgraded to help navigate the bank storm, with even easier access to huge savings on credit cards and loans despite the treacherous conditions, as well as integrated reviews from real customers to give you eye-witness accounts of bank disasters and financial life-savers.

Check out the Rate Chasers in action.

Stay dry Mozonians!

It was always a disappointment to me when the millennium rolled in and nothing happened. Kevin Costner had a large part to play in this, my desire to live in a barren post-apocalyptic wasteland piqued after watching Waterworld. I bought the canned goods and the bottled water. I sacrificed an entire summer’s worth of backyard cricket so I could construct a fallout shelter in the garden. So it was with glee and perhaps the tiniest glimmer of hope that I read about this latest development.

Were there irregularities in the time space continuum in Queensland and Western Australia? Should I be expecting a drive-by visit from a Delorean? More importantly, should I evict the 20 Israeli backpackers from my bomb shelter? They’ve been a real cash cow through the recession.

The whole saga got me thinking about what the world of banking will be like 6 years from now so I’ve constructed a basic timeline of events:

2011 – Gail Kelly becomes a blender jockey at her local Boost Juice after getting the heave-ho from Westpac on the back of a failure to glean a single home loan application in 2010.

2012 – In a bloody coup, the two American marketing gurus in the Commonwealth Bank ads take over the bank and install basketball hoops in branches and hand out money box transformers to kids, actually making going to the bank somewhat enjoyable. This popularity springboards them ahead of the competition and they take over an ailing Westpac, re-branding themselves as ‘Compac’.

2013 - NAB forced by the Australian government, led by a Hologram of the late John Howard, to annex ANZ when a financially crippled New Zealand becomes an Australian state (South Tasmania) and the unifying moniker of National Australia Bank was deemed to suffice for both.

2014 – Compac flourish for a couple of years till they are successfully sued for billions of dollars by American computer manufacturer ‘Compaq’ for copyright infringement. Daily Telegraph headline reports that the outcome has put the ‘Bank back into bankrupt’. Daily Telegraph headline writer fired.

2015 – With ‘Compac’ in dire straits, all their concerns are taken over by NAB. NAB renamed ‘The Bank’.

2016 - Nationwide backlash to what Howard labels a “perceived lack of competition”. Financial markets crippled as investors lose faith in “The Bank” after a 0.25% Reserve Bank increase is met with a 15% rise in the mortgage rate.

Year 0 – Former ANZ upper management turned radical New Zealand nationalists hacked into the software controlling the Howard hologram, and through a series of poorly thought out foreign policy moves, make North Korea unleash three nuclear warheads. Only those of us with fallout shelters remain. We have no oil or water, but luckily I have Gail Kelly with me to make me smoothies, fruit whips and juices. And there isn’t a financial institution in sight.

I guess the apocalypse ain’t so bad after all…

Compare banks with Mozo.com.au

What the….? Is this THE John Symond. The world really has changed.

When John Symond starts defending the banks you know something is wrong. The problem is, there are no challenger brands left, at least not on the lending side. In recent years the most successful challenger brands in lending have been Aussie, Wizard and BankWest. They have connected with consumers in a way the old players just cannot do, and have brought really strong products to market. And surprise, surprise, all were successful in attracting large volumes of customers away from the big banks.

So how does Commonwealth Bank respond, by competing with them on product and marketing? No, they take them out of the market instead. They bought BankWest, bought a stake in Aussie, and Aussie bought Wizard and swiftly killed the brand entirely. So we wake up today with a very different world where competition in banking is just not what it was. And that’s bad news for consumers.

So essentially Commonwealth Bank is now left to develop products and marketing as they see fit. Here’s an example I just saw on a banner ad this morning - ”No annual fees forever on the Low Fee MasterCard. That wasn’t so hard, was it?”

No, it wasn’t hard at all. Which is why I want to know why it took so long to do it? The no annual fee ever promise has been in the market for 6 years.

But worse than that, let’s look behind the headline message and see what the offer really is. Clicking it takes you to a page which then says:

“No annual fee for Commonwealth Bank customers who take up a new Low Fee credit card and spend $1000 per year. Annual fee $24 for non-Commonwealth Bank customers”

So in fact it isn’t even a no annual fee forever card at all!! And why market something on a widely shown banner ad that is actually only available for your own customers?? And never mind the fact that the interest rate is 18.49%.

When product development and marketing is left in the hands of the big banks it’s not happy times for consumers unfortunately. Let’s hope some new challenger brands are on the horizon, because Australians need them.