Bank mergers review and mutuals

The Senate Economics Committee Report on Bank Mergers commenced after the acquisitions of St George Bank by Westpac and Bankwest by the Commonwealth Bank in 2008 and concern about the economic, social and employment impacts of the recent mergers among Australian banks.

Although Labor senators have published a dissenting report and Senator Xenophon has published a minority report, the review identifies current issues and views on financial services competition.

The government senators’ report contains a brief section on “the critical role that mutual or member-owned financial intermediaries play in delivering competition and consumer choice in the banking sector.”

They recommend that:

Given the vital role that mutual financial institutions contribute to competition in the financial sector, the Government should engage with the mutual ADI sector to ensure legislation and regulation is consistent with assisting the sector to continue to grow and remain on a competitive and even playing field with the “big four” banks.

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