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Senate approves bank inquiry

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        - MEDIA RELEASE - SENATOR DAVID BUSHBY Liberal Senator for Tasmania Chair of the Coalition Economics Policy Committee

Advancing Tasmania’s Interests…  

DB28101001 Thursday, 28 October 2010

Senate approves Bank Inquiry

Chair of the Senate Economics References Committee, Liberal Senator David Bushby, today welcomed the Senate approving an Inquiry into competition within the Australian banking sector to be conducted by that committee.

The move follows record profits by NAB and ANZ banks in the face of reduced competition in the banking sector and was a joint proposal between Senator Bushby, Independent Senator Nick Xenophon and also supported on moving by Senator John Williams.

"We don't need to increase regulation of banks; what we need is more competition," Senator Bushby said.

"The government has done nothing to encourage competition and, if anything, has contributed to increased concentration in the banking industry. As such it has fallen on the Senate to consider the state of competition and what action can be taken".

Senator Bushby says facilitating effective competition in banking is the primary tool available to ensure decisions made by banks on interest rates, fees and innovations in products and services, are in the consumers’ best interests.

"It is time for a good hard look at the state of competition in the banking market," Senator Bushby said. The proposed Terms of Reference for the Senate Inquiry are:

a) the current level of competition between bank and non-bank providers; b) the products available and fees and charges payable on those products; c) how competition impacts on the fairness of terms that may be included in contracts

d) the likely drivers of future change and innovation in the banking and non-banking sectors; e) the ease of moving between providers of banking services; f) the impact of the large banks being considered ‘too big to fail’ on profitability and

competition; g) regulation that has the impact of restricting or hindering competition within the banking sector, particularly regulation imposed during the global financial crisis; h) opportunities for, and obstacles to, the creation of new banking services and the

entry of new banking service providers; i) assessment of claims by banks of cost of capital; j) any other policies, practices and strategies that may enhance competition in

banking, including legislative change;

k) comparisons with relevant international jurisdictions; l) the role and impact of past inquiries into the banking sector in promoting reform; and m) any other related matter.

For more information and comment from Senator Bushby please call -

Media Enquiries: Heath Michael - 0400 467 232

      Heath Michael  Senior Adviser/Media  Office of Senator David Bushby  Opposition Deputy Whip in the Senate  Ph: 03 6244 8533  Fax: 03 6244 8521  Mobile: 0400 467 232    Liberal Senate Team â€ Advancing Tasmania's Interests...