Banking Competition

"Competition takes a Swan dive…  Banking Review Media 3.2.2011In January 2009, on the back of the worst financial crisis many had lived to experience, we asked if the industry was about to see the death of competition. The removal of St. George and BankWest as serious competitors to the major banks delivered unprecedented market share to the Big Four. It was allowed to happen on the current government’s watch, who at the time defended the ACCC’s approval of the big banks swallowing their smaller rivals in the name of financial stability. Two years on, Treasurer Wayne Swan has decided to make the banks pay with a raft of measures designed to boost competition.But when broken down, many of these measures are token at best, and at worst likely to benefit the major banks more than their smaller competitors. The mutual sector is hoping the new measures will at least bring it in line with the major banks in the trust stakes (A mutual playing field), but it has a long way to go to really start impacting the market share of the majors. And it seems almost every big business, in banking or otherwise, is against the government’s proposed changes to the Trade Practices Act as part of its attempt to crack down on price signalling (Signalling under fire)."