23 January 2024

Katter calls for a new player to take on big four banks

| Matt Nicholls
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Katter’s Australian Party leader Robbie Katter says he is heartened by calls for the dilution of private corporate control over the provision of essential “public” services but that action could have been taken years ago had regional Queenslanders been listened to.

With reference the opinion piece by Associate Professor Paul Williams the Courier Mail where it was speculated that “public-owned” may become this decade’s “new black,” Mr Katter said regional Australians have been demanding greater market intervention by government in key sectors of the economy for decades.

Mr Katter has long said a “fifth pillar” in the banking sector was needed to curtail the market power of the so-called Big Four, which have consolidated their grip on home-lending with combined profits of over $41 billion last year.

“Corporate concentration across all sectors is the norm in most towns, with virtually no competition in airlines, supermarkets and telcos,” Mr Katter said.

“For decades, banks peddled the idea that their economic interest and those of the community went hand in hand.

“The presence of a local manager who could be relied upon to help you pull a calf from a creek or pitch in at a sausage sizzle was intended to solidify the image that banks somehow had a social mandate.

“With branches disappearing from the main street of every other country town, the myth is now well and truly busted, and regional Queenslanders were the first to feel the brunt of that.”

Figures from the banking watch dog, the Australian Prudential Regulation Authority (APRA), show a 37 per cent decline in the number of banking institutions offering face-to-face services between 2017 and 2023 nationally.

In Queensland, branch numbers declined from 1203 in 2017 to 779 as of June 2023, a drop of 35 per cent.

Mr Katter said the APRA’s prudential standards have consolidated the power of the “Big Four”, as they have the means to meet the compliance costs more easily than competitors.

Mr Katter said a more effective way to regulate the banks’ behaviour was the introduction of a new player with a government-backed guarantee, which could “lead by example,” forcing the major banks to adapt their levels of service, profit expectations and risk tolerance to remain competitive.

Mr Katter said encouraging Australia Post to enter the Australian banking sector by providing it with a banking license would the first step toward installing a substantial competitor to the major banks, forcing them to lift their levels of service.

“By making a banking licence available to Australia Post, the national parcel carrier could offer basic deposit, credit card and mortgage facilities to begin with, injecting some competition into the sector riding on the back of their existing branch network of 4500 outlets.”

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