Scott Morrison says regulators are ‘no light touch’

The Australian 10:16am June 6, 2018

Remy Varga

Treasurer Scott Morrison has downplayed the role of the royal commission and said the “very focused, very determined” government regulators are already addressing issues within the banking and financial sector.

Six of Australia’s most powerful investment bankers were charged over alleged cartel conduct yesterday following an investigation by the competition watchdog. The charges came a day after Austrac hit the Commonwealth Bank with a record $700 million fine.

The Treasurer declined to comment on whether the whopping fine was intended as warning to other banks and financial bodies, but said it was proof the regulatory agencies effectively kept the sector in line.

“Whether it was the BBSW [Bank Bill Swap Rate] issue that was taken through the banks … whether it was criminal matters … whether it was the CBA with Austrac … under this government we’ve had very focused, very determined regulators doing their job.” he said on Sky News.

Mr Morrison said while the results of the royal commission would not be known until its completion, the recent action taken against corporate malfeasance was due to the work of government regulators.

“I don’t think anyone can say, under this government, there has been any sort light touch from our regulators.” he said.

The Treasurer said he believed leaders in the banking and financial sector were taking appropriate action to affect cultural change within organisations.

“They’re very focused on rebuilding trust for institutions and I think the decision by CBA was a good indicator of that … they’ve taken a whole range of actions within the organisation as they should.”

He also warned of possible risks to the economy emerging from the royal commission and urged caution in responding to its findings.

“The commission will take its course but the response to it is really going to be the issue and we’ve got to be careful so we don’t create a self fulfilling problem here.” he said. “Credit is important in our economy … our banks are the strongest in the world, so this is a big financial asset for us,” he said. “We don’t want to go and undermine that by creating unnecessary regulation which basically constricts and suffocates the economy.”