What the bank bosses had to say at the royal commission, in language you can understand


What the bank bosses had to say at the royal commission, in language you can understand

In the commission’s interim report released in September, Commissioner Kenneth Hayne said the regulators had sufficient powers to police their beats, but were not making sufficient use of them.

The royal commission tried to cut through the apologies and the corporate jargon to get to the heart of what went wrong at Australia’s biggest banks. Here are the major lowlights of the inquiry, simplified.



  • It’s “not uncommon” for Westpac staff to falsely witness and fill out loan documents on behalf of clients, the commission heard, examining the case of legally blind pensioner Carolyn Flanagan.
  • Westpac continued to pay ‘flex’ commissions until an ASIC ban came into effect. These commissions, paid by lenders to car dealers, allowed the dealer to set the interest rate on the car loan. The higher the rate the larger the commission earnt by the dealer.


  • The bank got tellers to sell superannuation, despite knowing tellers weren’t qualified to sell the product and would be breaking the law. The chief risk officer called it “extreme”, but it garnered the bank an extra $3.6 billion in funds under management.
  • Of many appalling examples in farming finance, the treatment of fourth-generation Victorian farmers the Cheesmans was a standout. Despite a bank report that including their homes in the sale of the farming land would decrease the value of the deal, ANZ pushed them out of their homes anyway.



  • The company misled the regulator so many times a witness was forced to explain it “lost count”.
  • AMP’s then-chairman, Catherine Brenner, suggested changes to an apparently independent report by law firm Clayton Utz — asking for the then-chief executive Craig Meller’s name to be taken off the list of people interviewed in its preparation.
  • An internal AMP report said letting customers know they were paying fees for no service could lead to calls for compensation. And, worse, informing punters “would be a very negative customer experience”.

After 68 hours of hearings, 134 witnesses, 400 witness statements and 6,500 documents, the banking royal commission has come to an end. The big end of town will breathe a sigh of relief that the slow torture at the hands of senior counsels Rowena Orr and Michael Hodge, which has comprehensively trashed the industry’s reputation and business model, is finally over. They can get back to their towers and hope that the damage from Kenneth Hayne’s final report in February is not too bad.

But the clamour for a royal commission 2.0 is already starting to build among victims of misconduct in the financial services industry. They are unanimous in saying that the inquiry – although thorough and on occasions a brutal expose of the industry’s shortcomings – heard from only 27 customers and did not go nearly far enough.

Curtain comes down far too soon

For thousands of victims, it was a missed opportunity for closure.

“We will adjourn.” With those three words, Kenneth Hayne bowed and drew the final curtain down on the royal commission into misconduct in the banking superannuation and financial services industry.

If there was a sense of disquiet it was due to the topics and institutions that had been missed from this short yet headline-grabbing event.

In the 68 hearing days, covering 134 witnesses and thousands of exhibits we have seen dishonesty and entrenched conflicts of interest. We have watched the flawed, arrogant – and sometimes contemptuous – leaders that run the nation’s biggest financial institutions. We have had rampant, institutionalised corruption on full display.

Regulators negotiating soft outcomes and compensation delayed for years, have been common themes.

The royal commission has had a profound impact on these organisations. ASIC has promised to become tougher, APRA will do better.

Companies have moved too. Some banned grandfathered commissions, divisions have been shut down or spun out, dodgy products cancelled and some players have departed.

But it hasn’t gone far enough or deep enough. Time and limited terms of reference were the inquiry’s enemies. How else can it be explained that Macquarie Bank appeared for less than an hour? Or that the $1.7 trillion superannuation industry with all its complexities was allocated two weeks?

Or that some institutions, divisions and industries, including consultants, missed out completely?

When then prime minister Malcolm Turnbull “reluctantly” called the royal commission a year ago it was only after the banks had written to him beseeching him to press the button and take control of the inevitable. His reluctance resulted in a 12-month royal commission that was never going to be adequate given the size, intricacies and magnitude of what it was covering and the sophistication of the misconduct.

As council assisting Rowena Orr said in her closing speech, it has been “enormous”. The commission could have lobbied for broader scope and more time in response to that enormity. Sadly, Hayne never did.

For the victims who wanted their stories told, most never stood a chance. With more than 10,000 submissions fewer than 30 victims were called. For thousands it was a missed opportunity for closure. It also prevented the commission hearing firsthand the lives destroyed by greed, dishonesty and a lack of accountability. This would have been potent and useful.

A lot of evidence was left to the banks to supply. As history has shown, self reporting can be problematic.

Asking institutions to list their own past misconduct was fraught with risk.

Yet the royal commission has put the spotlight on the sector like never before. Orr’s performance has been stellar, along with Hayne’s razor sharp summaries. Seeing the arrogance and blatant disrespect pouring out of NAB chairman Ken Henry in full throttle, the clay feet of Commonwealth Bank chairman Catherine Livingstone and the contempt of IOOF’s Chris Kelaher speaks volumes about those businesses.

In the end we will have the recommendations, an election campaign and Labor’s next move.

The opposition is in the box seat to push for further mini royal commissions to give the people a voice and air those topics, institutions and people that it missed – or it can move on.

This is a moment in time that won’t easily be re-captured. Let’s hope it isn’t squandered.