Weekly Update: 25 October 2024

Highlights this week:

• Announcement: The ACCC has granted interim authorisation to the ABA for cash-in-transit initiatives and business continuity planning.
• In the Media: Commentary on banks’ appearance at senate inquiry.

Quote of the week:
“At the moment, there’s no clear obligations on either the banks, the telecommunications companies or the social media platforms. And all of these businesses have got a key role in that scam production chain.”

–  The Hon Stephen Jones MP, Assistant Treasurer and Minister for Financial Services. Interview with Bridget Brennan, News Breakfast, ABC, 24 October 2024.

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Media & Communications Update:

• The ABA provided a statement to The Age / SMH on the Federal Insurance Inquiry relating to the 2022 floods, saying “Banks already account for risks in assessing lending applications, however the ABA will work with the Government to better understand any potential future implications of these recommendations.”
• The ABA also provided information to ABC Brisbane on bank branch cash withdrawals limits and policies.
• ABA’s Chief of Policy, Chris Taylor & Policy Director, Craig Evans appeared at the Senate Economics References Committee on Financial Regulatory Framework & Home Ownership.

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Policy Update:

• ABA CEO, Anna Bligh spoke at a MinterEllison conference on global mega-trends impacting the banking industry.
• On October 21-22, the ABA attended the Global Anti-Scam Summit Asia 2024. The Singapore conference brought together speakers from across regulators, banks, digital platforms and civil society. Speakers reflected the importance of working across the ecosystem and provided insights on regional scam trends across South-East Asia.
• The ABA met with:
  • APRA to discuss their current consultation on AT1s.
  • Treasury to discuss Treasury’s work on nudges.

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Regulatory Update:

• The RBA Deputy Governor Andrew Hauser participated in a fireside chat at the CBA 2024 Global Markets Conference.
• APRA published their opening statement from the Senate lending inquiry.
• ASIC Commissioner Kate O’Rourke gave a keynote address at the 34th Annual Credit Law Conference.
• The RBA released draft papers presented at the Reserve Bank of Australia 2024 Conference.
• APRA published their opening statement from the House of Representatives Standing Committee on Economics.

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Parliamentary Update:

• Senate lending inquiry: The public hearings of the Senate Economics References Committee inquiry into financial regulatory framework and home ownership took place on Thursday. Committee Chair Senator Bragg released a media statement following the hearings. Topics of discussion at the public hearings included:
  • Supply: widely acknowledged as the paramount issue for greater home affordability
  • Serviceability buffer: Should it be reviewed or changed for first home buyers (FHBs)?
  • Views of banks: on risks, buffers, and loan assessment processes
  • First Home Guarantee scheme: supported broadly
  • RLOs and regulatory guidance: is change needed?
  • Capital weights: can they be reduced for FHBs?
  • HECS: potential for alternative treatment in loan assessments
  • Lenders mortgage insurance: can banks just waive it and take on that risk?
  • FHB risk: FHB arrears compared to the overall mortgage book
  • Hardship: Greens Senator Barbara Pocock proposing consideration of a new industry levy towards those that fall into hardship
• World economics: Treasurer Jim Chalmers travelled to Washington DC for G20 meetings. He also issued a media statement following the release of the IMFs Fiscal Monitor.
• Surcharging: The Prime Minister took to social media to discuss the Federal Government’s plans to ban debit card surcharging.
• AFCA funding: Assistant Treasurer Stephen Jones announced $14.7 million over two years to the Australian Financial Complaints Authority (AFCA) to establish a clear single pathway for scam victims to seek compensation. 
• Scams Prevention Framework legislation: Assistant Treasurer Stephen Jones stated that the Government is considering the feedback provided during consultation to inform development of a final bill for introduction to Parliament this year.
• ASIC & APRA: appear before Parliamentary Committees on Friday.

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Economic Update:

• The IMF released the World Economic Outlook which showed Australia’s projected:
  • GDP growth by Q4 2025 to be higher than the average of all advanced economies (2.2% compared to 1.7%) but lower in the immediate term (1.5% compared to 1.9% for Q4 2024).
  • CPI to remain above the average of other advanced economies for both 2024 (3.0% compared to 2.2%) and 2025 (3.6% compared to 2.0%).
  • Current account balance to be in deficit in 2024 (-0.9%) 2025
    (-1.1%) and 2029 (-1.3%). However, this remains lower than projections for the US, UK, Canada and New Zealand.

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Coming up next week:

• Data:
  • 30/10 – Consumer Price Index, Australia
  • 31/10 – Retail Trade, Australia
  • 31/10 – Building Approvals, Australia
  • 31/10 – Monthly ADI Statistics
  • 01/11 – Lending Indicators
  • 01/11 – Monthly Household Spending Indicator
• Parliament:
  • No Parliamentary Sittings next week.
  • 25/10 – ASIC & APRA: appear before Parliamentary Committees.
  • 30/10 – Senate hearings into Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2024 [Provisions].
  • 1/11 – PJC hearings into Oversight of ASIC, the Takeovers Panel and Corporations Legislation.

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Upcoming Submissions:

Submission this week: 8/11 – Submission on the AT1 discussion paper.

Published submissions

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Upcoming Events:

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Selected Media:

• ABC – Big banks use artificial intelligence to help assess home loans, call centres soon may be fully automated
• AFR – Calls to reduce 3pc home loan bank buffer test
• AFR – Australia a laggard in the global battle to beat inflation
• AFR – Don’t expect rapid fire rate cuts: RBA deputy governor
• News.com.au – Government unveils support for scam victims in latest crackdown
• The Australian – No stamp duty and reduce APRA mortgage buffers keys to making housing accessible: Mirvac

Warm regards,
The ABA Team

Weekly Update