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Heads must roll at CBA, says Treasurer

Heads must roll at CBA, says Treasurer

Tim Stewart
— 1 minute read

Federal Treasurer Scott Morrison says he expects there will be more board-level and executive departures at CBA following the release of an APRA report into the bank he described as "damning".

Mr Morrison spoke to reporters yesterday about the final report of APRA's prudential inquiry into CBA, first announced on 28 August 2017.

The report found the board of CBA was "reactive and complacent" when it came to its governance, culture and accountability frameworks – with the bank entering into an EU with APRA to implement the report's 35 recommendations. 

APRA has also announced a $1 billion add-on capital charge for CBA.

Mr Morrison said the report found CBA had an "ineffective board that lacked zeal and failed to provide oversight" and a "lack of accountability and ownership of key risks by senior executives".

The "rap sheet", as Mr Morrison put it, is "damning" for CBA.

It is the chairs, chief executives and senior executives of CBA that have "let the institution down", Mr Morrison said – not the front-line staff.

"We need to focus where the real responsibility and accountability lies here and it is in these boards and it is with these executives. That is what I expect to happen, what the government expects to happen and you can be assured they'll be getting my very keen focus," he said.

Asked whether those responsible should be "sacked on the spot", Mr Morrison replied:

"A number of the board members, as you know, have already gone. A number of executives have already gone. And my understanding is there will be others who will be leaving and that's what I would expect to be happening," he said.

CBA chief executive Matt Comyn and chair Catherine Livingstone gave a conference call for investors and analysts in response to the report, in which Ms Livingstone apologised for the banks "failings" over the recent years which led to [the APRA] report".

Mr Comyn said he was preparing a 60-day remedial plan to implement the changes in the APRA report, after which CBA will report to an independent reviewer every three months.

 

Heads must roll at CBA, says Treasurer
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