Big bank domination to be scrutinised
An upcoming international meeting of banking chiefs is likely to raise questions about the domination of Australia’s major banks, a commentator has suggested.
John Durie, a columnist for the Australian, said that in addition to having control of the home loan market, the major banks now also have a stranglehold on wealth management as the main recipients of government protection.
He said that a meeting held this weekend in Switzerland by the Bank for International Settlements would seek to temper the advantages of the big banks by working for better bank regulation and by discouraging risk-taking.
Mr Durie added that unlike other financial services around the world, Australia’s major banks had been able to improve their standing during the economic crisis.
"The Australian banks are smart to have used the crisis to expand their empire. The issue only creates concern when consolidation reaches a point of no return," he said.
Varying mortgage interest rate rises across the banks have encouraged Aussies to compare home loans in search of the best deals. This week AFG, Australia’s largest mortgage broker, told the Age that a large proportion of its business in December came from Westpac customers switching to other lenders.
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