CANBERRA (Reuters) – Australia's corporate regulators will be exposed to a new supervisory body in the shaking of the banking sector, recommended by a high-powered, independent request for financial greed and malpractice.
A copy of the financial sector survey report is seen at a press conference held by Australian treasurer Josh Frydenberg in response to the release of the bank's Royal Commission discovery in the Canberra parliament in Australia on 4 February 2019. AAP Image / Mick Tsikas via REUTERS  The government-appointed inquiry known as a royal commission also recommended prosecution for 24 cases of injustice and informed that business rewards structures were reassessed to remove systemic conflicts of interest.
Authorities were encouraged to consider charging fees over behaviors such as service charges not made, including deposits with major lenders Commonwealth Bank of Australia, National Australia Bank Ltd and Australia and New Zealand Banking Group.
The Commission's recommendations were released by the government Monday after the public inquiry heard 11 months of shocking revelations of misdemeanors that deleted $ 60 billion from the country's top-financed stocks.
Misunderstanding reached the sector's upper echo, with Supreme Court Chief AMP Ltd, which involved breach of a level-level regulator over deliberate charging of customers for financial advice it never gave.
Companies were found to swap some of the society's most vulnerable customers, highlighted by the case of an insurance company that used aggressive sales techniques to sell an opaque product to a young man with Down's syndrome.
"The price paid by our community has been tremendous and goes beyond just the economic," said Australian cashier Josh Frydenberg as the government promised to take action on all 76 recommendations.
"Companies have been broken, and emotional stress and personal pain have destroyed life."
The recommendations also include the prohibition of descendants of third-party home loan members, forcing financial planners to disclose any fees they receive for selling products, and forbids banks from claiming default interest on drought-affected businesses.
Regulators also needed greater oversight after they were accused of working too closely with the banks. When negligence was revealed, either the impunity or the consequences did not reflect the severity of what had been done, the survey found.
Australia's corporate governor said in response to the report that it would prioritize serious cases as referred to by the Royal Commission for possible prosecution.
BANK SHARES RISE
Prior to the release of the report, which came after the market closure in Sydney, the shares of the "Big Four" banks closed about one percent as investors looked forward to some certainty about the new regulatory framework.
However, wealth managers, whose reputation was cut in the survey, were penalized by the IOOF Holdings Ltd shares which closed 4.5 percent and AMP pushed record high. The wider market closed 0.5 percent higher.
"The important macro problem we have been interested in is that this would reduce the banks' willingness to lend further, which would be a further blow to the economy already under pressure," said Andrew Ticehurst, a strategist at Nomura. 19659004] "At this stage, it does not seem to be the case. It would be a bit milder than expected. "
Fallout from the Royal Commission has already asked the banks to tighten lending practices in their core corporations, which contributes to some of the largest housing prices in a generation.
The report comes before an election expected in May, where falling house prices may become a problem with the hot button.
The Conservative government, which for several months defended the banks and rejected calls, is fighting for its survival with polls suggesting an election opportunity for the middle-left Labor Party.
Work says it Expect to Adopt All Commission Recommendations
While Prime Minister Scott Morrison has said he will address the recommendations, he has warned against overreaching and cutting credit flows.
Report from Commissioner Kenneth Hayne, a former Supreme Court righteousness, found that the industry's problems were exacerbated by the unwillingness to accept responsibility.
"There is still a reluctance in widows Unite entities to form and then give practical effect to their understanding of what is ethical, what is effective, honest and fair, about what is right to do, "reports said.
National Henry Bank's chairman Ken Henry came in for particular criticism after perceiving rejection during his public interrogation by the Commission's lawyers.
"I thought it was Dr. Henry did not seem to accept any criticism of how the board had dealt with any problems," commented Commissioner Hayne, adding that he was not as confident as I would wish to have been past lessons learned ".
Australia's Banking Officer Anna Bligh said the banks" accept full responsibility for these errors and they know that they must now switch to ensure that this never happens again ".
"Banks are determined to learn the lessons, fix the issues and do the right thing," she said.
Reporting by Jonathan Barrett and Swati Pandey; Further reporting by Byron Kaye, Paulina Duran and Tom Westbrook; Stephen Coates