Weekly update: 10.03.23

“Ms Edwards’ work in the financial sector over the past 17 years has resulted in significant improvement in the way financial services engage with, assist and support First Nations people and communities” 

– Dominic Perrottet on the naming of Lynda Edwards, First Nations community leader & ABA COG member, as 2023 NSW Premier’s Woman of the Year

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Parliamentary Update:

• Assistant Treasurer Stephen Jones introduced bills into the House to enact the Financial Accountability Regime and the Compensation Scheme of Last Resort. The bills are likely to be debated in the week commencing 20 March 2023.
• The Assistant Treasurer announced a review of the regulatory framework for managed investment schemes. Funding for this review was first announced in the October 2022 Budget.
• The Federal Government’s National Reconstruction Fund Bill was passed through the House, with amendments from Adam Bandt and Zoe Daniel.
• The Prime Minister led a delegation of business leaders on an official visit to India. Increasing trade, security cooperation and cultural ties were key focusses of the visit.
• Treasurer Jim Chalmers delivered a key address to the AFR Business Conference, discussing his long-term view of the Australian economy.
• Housing Minister Julie Collins authored an opinion piece in the Daily Telegraph on housing affordability and Federal Government programs in this area.

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Policy Update:

• Lynda Edwards, a proud Wangkumara and Barkandji woman, and member of the ABA Consumer Outcomes Group (COG) received some well-deserved recognition at the 2023 NSW Women of the Year awards this week. Ms Edwards was awarded both the NSW Aboriginal Woman of the Year and the NSW Premier’s Woman of the Year award.
• Lynda has been an integral member of the COG and contributed to important access to banking initiatives that the COG has considered, as well as playing a leadership role in the Save Sorry Business campaign to support First Nations customers affected by the Youpla funeral insurance collapse.

• Australian Network on Disability (AND) is overseeing the review of the Australian Banking Association’s Accessibility Principles. The principles ensure that banking services in Australia are optimally placed to deliver the best accessibility and inclusive experience for their users. The current Accessibility Principles for Banking Services can be found here.
• As part of the project AND are seeking feedback from people with disability, carers and advocates on their experiences of everyday banking: Accessibility of everyday banking survey. All responses will be confidential and anonymous. The survey will close on 31 March 2023.
• The ABA published a Capital Comparison Study Report, developed with PwC, which identifies the main differences between APRA’s new capital regime and the BCBS (Basel Committee on Banking Supervision) framework. The report provides a common methodology for calculating the impact of these differences on banks’ capital ratios.

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Regulatory Update:

• ACCC released an issues paper related to their September 2023 interim report for the digital platform service inquiry. The focus of this year’s report will be on the expanding ecosystem of digital platform service providers. Issues of concern include the impact on competition of their expansion strategies as well as potential consumer harms that may result from reduced choice and problematic data practices.

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Economic Update:

• There has been a pick-up in insolvencies in recent months, after a sharp decrease in insolvencies during the 2020/2021 COVID period, primarily due a to large amount of government and other support provided to businesses, see Figure 1.

Figure 1: All external administrator and controller appointments, July 2021 – February 2023, N

Despite the recent increase, insolvencies still remain beneath the longer-term trend when considering the proportion of insolvencies each quarter relative to the number of businesses operating at the end of the previous financial year. Between 2003 and 2016 insolvencies occurred to between 0.12% and 0.2% per cent of all businesses, while recent increases return us to around 0.10%, see Figure 2.

Figure 2: Proportion of external administrator and controller appointments, relative to all Australian businesses, 2003 – 2023, %

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Communications and Media Update:

• The ABA held an International Women’s Day panel event on Wednesday in Sydney, examining emerging challenges in the post-pandemic workplace and ways leaders can ensure they are effectively advancing equity. ABA CEO Anna Bligh held a Q&A with panellists: ING Australia’s Chief Executive Officer, Melanie Evans, Culture Amp’s Senior Director of Equitable Design, Aubrey Blanche and MinterEllison’s Partner in Risk and Regulatory Consulting, Donna Worthington. Anna spoke about how there had been a transformation in many key leadership categories in the banking sector, with an increasing number of women moving into the upper ranks. Read more.

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• Anna also attended an ING breakfast event for International Women’s Day hosted by Leigh Sales AM, plus spoke at an IWD event in conversation with the Mayor of Mosman, and also spoke at the Future Women Leadership Summit 2023 in Sydney, joined by panellists: KPMG Australia National Chairman, Alison Kitchen, Australian Army Commander Forces Command, Major General Susan Coyle AM, and Co-founder, MoneyGirl, Mariam Mohammed. Read more.
• Key media this week included an interview with Channel Nine News on the issue of scams. See the full clip here. The ABA also published a statement to our website following the RBA’s interest rate announcement on Tuesday. Read more. There was also extensive commentary in the media from Suicide Prevention Australia outlining the work banks and the ABA are doing in these difficult times to assist customers.

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Submissions Lodged:

• Treasury Laws Amendment (CDR) Bill 2022
• Token Mapping Consultation Paper

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Upcoming Submissions:

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Selected Media:

• AFR – Nine in 10 mortgagors are already cutting back.
• AFR – ANZ’s Shayne Elliott on why India’s time has come
• AFR – Coalition backs ‘self-regulation’ of financial advisers
• SMH – CBA boss defends big bank profits, says customer hardship still low

Weekly Update