ACCC prepares to take on the big banks
Australian Financial Review Oct 18 2017 2:00 PM
Jonathan Shapiro
The chairman of the competition watchdog says it will ramp up its work on the banking sector in July next year, as it responds to demands from the government to scrutinise the market power of the big four banks.
The chair of the Australian Consumer and Competition Commission, Rod Sims told an audience at the Citi annual investment conference that from July next year it will be free to "explore competition topics of our choice"
"The fun bit starts in July next year," he said explaining that until the end of the current financial year the ACCC will have a mandate to examine how the banks are passing through the recently imposed bank levy that formed part of Federal Treasurer Scott Morrison's May budget.
"We have a few interesting ideas – we will look at a range of competition issues "
Mr Sims said he believed their future work in the banking sector will make a difference.
"The big issue in banking is that you have four big players and their market share has done nothing but increase over the last twenty years or so.
"There are other big banks, but they don't seem to make an inroads.There some quite bug players other than the big four but they are not really gaining any traction – now why is that?"
Mr Sims explained how he was seriously berated by politicians at the House of Economics Senate Estimates hearing "for not doing anything in the banking sector".
"We had just pointed out we had taken ANZ and Macquarie Bank to court for cartel conduct but that didn't count – what they meant is 'why aren't they examining how competitive the industry is?'"
He said his response that the Australian Prudential Regulation Authority and the Reserve Bank had a remit over the banking sector "didn't go down well" because politicians pointed out that "they don't care about competition".
"Anyway, I said I didn't have a lot of resources so they solved that and gave us a lot of money, and the market study is open ended."