22 Apr 2018

Banking inquiry in Australia 'wake-up call' for NZ subsidiaries

12:51 pm on 22 April 2018

A public inquiry into the banking sector could provide reassurance to the public, says a banking expert.

A bundle of New Zealand money.

Photo: RNZ / Alexander Robertson

But Claire Matthews from Massey University's business school doesn't believe banks in New Zealand are involved in the sort of misconduct exposed in a royal commission in Australia.

On Friday, the chief executive of Australia's AMP bank, Craig Meller, resigned after practices, such as charging customers fees for advice that was never delivered, were revealed at the Royal Commission.

Australian banks own most of New Zealand's major banks.

Dr Matthews said there was no harm in taking a closer look at what was happening in this country.

"I don't think it would necessarily hurt to have some kind of review of the New Zealand banks because that would provide some reassurance to the New Zealand public, but at the same time I don't believe that anything to the extent of what's going on in Australia is required because I'm not convinced that the same issues are present in New Zealand."

Consumer New Zealand head Sue Chetwin agrees and said the inquiry in Australia had been a wake-up call for the New Zealand subsidiaries.

"There are some activities in New Zealand where banks have been able to act quite freely, say in terms of fees and charges, where I think that they'll be looking at those quite closely now and making sure that there's no reason that the regulators need to start an inquiry in New Zealand."

Ms Chetwin said local banks had begun scrapping some ATM fees, which could be in reaction to the Australian inquiry.

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