The Federal Opposition has renewed its calls for a Royal Commission into the banking and financial services industry in the wake of the Australian Securities and Investments Commission (ASIC) commencing legal action against National Australia Bank over alleged Bank Bill Swap Rate (BBSWR) manipulation.
However the Government has continued to resist calls for a Royal Commission, with the Minister for Trade, Steve Ciobo, arguing that ASIC was already appropriately empowered to deal with the issues around NAB.
The legal proceedings commenced by ASIC against NAB follow on from similar actions initiated against two of the other major banks — ANZ and Westpac.
Further, ASIC has pointed out that prior to filing against ANZ and Westpac, ASIC’s investigations into misconduct in the BBSW had seen the regulator accept enforceable undertakings from UBS-AG, BNP Paribas and the Royal Bank of Scotland.
NAB has signalled it will be strongly defending the ASIC charges against, but the Federal Opposition has been quoting as suggesting the litigation is further evidence of the need for a Royal Commission into the banks.
By comparison, Ciobo pointed to the action initiated by ASIC and said this reinforced the government’s view that a Royal Commission wasn’t needed because ASIC had sufficient powers.
“Our view is that already these powers are available and they will be utilised,” he said on national television.
The Federal Opposition earlier this year made clear that it was looking towards a Royal Commission extending beyond the banks and into the broader financial services industry.
Federal Opposition financial services spokesman, Jim Chalmers, in April outlined areas of reference for a Royal Commission.
A Royal Commission into the financial services industry will examine issues such as:
- How widespread instances of illegal and unethical behaviour are within Australia’s financial services industry;
- How Australia’s financial services institutions treat their duty of care to their customers;
- How the culture, ethical standards and business structures of Australian financial services institutions affect the behaviour of these institutions;
- Whether Australia’s regulators are really equipped to identify and prevent illegal and unethical behaviour;
- Comparable international experience with similar financial services industry misconduct and best practice responses to those incidents; and
- Other events as may come to light in the course of investigating the above.
