Westpac CEO Peter King and Australian Banking Association CEO Anna Bligh met Treasurer Jim Chalmers, call for end to regulation strangulation
The Customer Owned Banking Association also backs the “regulatory grid”, and was a signatory on a letter sent by the ABA to Mr Chalmers on Monday.
Mapping out the timing of demands made by different regulators will “improve clarity about upcoming consultations and proposed implementation timeframes” the banks said in the letter.
Ms Bligh told The Australian Financial Review the grid “will help ensure sequencing, transparency, and focus on the initiatives that will best drive efficiency and productivity across our economy”.
The idea was raised by Ms Bligh during a parliamentary committee hearing in Canberra on August 31 and in an earlier interview with the Financial Review in June, where she described a similar scheme in the UK as being “instrumental in driving productivity gains and fostering innovation in the United Kingdom”.
COBA CEO Michael Lawrence, whose members are small banks, said the problem of too much regulation is particularly acute for lenders with limited legal and compliance resources.
“Poorly coordinated regulation stifles competition by making it harder for smaller banks to balance regulatory imposts with essential growth initiatives,” he said. “The grid will enable smaller banks to see what is ahead and better-plan for it, allowing much needed breathing space to grow their businesses and invest in new technologies.”
Ms Baker said: “A coordinated approach through a UK-style regulatory grid will provide a predictable, staged approach to the implementation of regulation and reduce the impact of regulatory change on non-major banks.”
After digesting the 1175 pages of new laws and regulations since 2019, the ABA has identified 130 different regulatory changes in train over the next 18 months.
These include the Financial Accountability Regime and Compensation Scheme of Last Resort; the Quality of Advice review; and laws setting up the Consumer Data Right. Treasury is also proposing many new regulations around payments, digital platforms, BNPL and climate-related disclosures, while the Attorney-General’s Department is reviewing the Privacy Act.
Meanwhile, the Reserve Bank is exploring central bank digital currency and retail payment changes; the ACCC is conducting a retail deposit inquiry; ASIC is targeting financial hardship (it sued Westpac earlier this month) and responsible lending; and APRA continues to make demands around operational risk, macroprudential policy, data transformation, stress testing and resolution planning.
The UK government established a regulatory initiatives forum in 2020 that publishes a grid twice a year, setting out a two-year outlook of reforms.
