APRA has said the recent damage to CBA’s reputation is “unhealthy for the bank, it’s unhealthy for the banking system and it’s unhealthy for the country”.
Appearing before the standing committee on economics this week, APRA chairman Wayne Byres defended the rationale for his organisation's inquiry into the Commonwealth Bank.
Labor MP Madeleine King pointed to Mr Byres' opening statement to the committee, which stated that APRA is seeking to make a "constructive contribution to strengthening the reputation and public standing of [CBA]".
"What part of APRA's mission is it to help CBA recover its reputation and community standing?" Ms King asked.
In response, Mr Byres said part of APRA's remit is not only to ensure the banks are well capitalised, but to make sure Australians "understand and trust that [the banks] are well governed and prudently managed".
"The issue that we sit here with the largest bank in the country with its reputation badly damaged. It's unhealthy for the bank, it's unhealthy for the banking system and it's unhealthy for the country and the broader community that the bank finds itself in this situation," Mr Byres said.
Mr Byres said that because the final report of the inquiry will be made public, it will be "very difficult" for CBA not to respond to its recommendations.
"We'll have to establish some sort of mechanism that allows for transparency around the extent to which the recommendations are being addressed, and are being addressed in a timely manner," Mr Byres said.
When it came to the likely themes of the inquiry, Mr Byres said he was reluctant to guess them lest he be accused of pre-empting the process.
"I think CBA itself has already acknowledged that there are issues around the complexity of the organisational structure and some blurring of accountabilities between different parts of the organisation. But let's see what the inquiry comes up with," Mr Byres said.
The Federal Court has ordered a stockbroking firm to pay penalties and court costs of up to $500,000 for failure to comply with the Corps Ac...
Banking regulators around the world are focusing on addressing company culture to prevent misconduct, according to a report by Herbert Smith...
Income investors have been cautioned to prepare for potential changes to a variety of government policies should Labor win the next federal ...