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Senate bank competition inquiries re-commence

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- MEDIA RELEASE - SENATOR DAVID BUSHBY Liberal Senator for Tasmania Chair of the Senate Economic References Committee

Advancing Tasmania’s Interests…

DB20011101 Thursday, 20 January 2011

Senate Bank Competition Inquiries Re-commence

Chair of the Senate Committee conducting the Banking Competition Inquiry, Liberal Senator David Bushby, said today that the re-commencement of the hearings on Friday (tomorrow) will allow continued scrutiny of the state of competition in the banking industry and options to increase competition, whilst also providing a forum to consider the impact of Treasurer Swan's proposed banking reforms.

"Continued concern over the consequences of the major banks gaining ever higher market shares and a lacklustre reception to Mr Swan’s proposed reforms to address those concerns, highlights the potential benefits that this Inquiry could deliver to Australians,” Senator Bushby said.

Senator Bushby noted that in the last three years, the banking industry has become far more concentrated, as priority was given to maintaining stability of the system, even if it came at the expense of competition. As a result, the big four saw their share of just about all aspects of the banking market grow significantly, in some areas to over 90% of the market.1

The extent to which this was an unavoidable consequence of the international financial crisis or a consequence of decisions made by the Federal Government during that crisis is being examined by the Inquiry. What steps can now be taken to redress the balance between competition and stability to deliver the best possible outcomes for Australians is also a major focus of the Inquiry.

Senator Bushby said hearings for the Senate Bank Inquiry would re-commence in Sydney on Friday 21 January, followed by a second day in Melbourne on Tuesday 25 January, with additional hearing days to be set.

For more information and comment from Senator Bushby please call -

Media Enquiries: Heath Michael - 0400 467 232

1 IBISWorld report on the sector from October 2010 which shows (on page 27) that the Big four banks are

responsible for 92.2 per cent of market share.