The Australian Greens finance spokesperson, Senator Peter Whish-Wilson, said today that the “ugly spectacle” of Westpac and ANZ traders joking about their apparent rigging of the bank bill swap rate (BBSR) strengthened the case for a Royal Commission in the financial services sector.
Senator Whish-Wilson said, “Trader’s antics are no joke. This sort of callous disregard for the harm being caused reflects a deeper cultural problem at the heart of the financial sector.
“A culture of indifference has been evident in the litany of financial scandals that have come to light in recent years. We need a Royal Commission to fully explore the incentives that sit behind this bad behaviour.
“We need a Royal Commission to explore the fundamental issue of vertical integration. The merging of retail banking with investment banking has created misaligned incentives and is taking the big four banks into ever more risky and speculative activity.
“The Financial Systems Inquiry ducked the issue of vertical integration. This is despite explicit government insurance for the big banks via the deposit levy guarantee and the committed liquidity facility.
“We need to fully understand the nature of the problems in the financial sector so that government and regulators are able to respond appropriately and proportionately.
“The Australian economy is underpinned by a strong banking system, but we can’t be complacent about the health of the sector. We need a Royal Commission to ensure Australia’s long term prosperity. We need a Royal Commission to put an end to the rot,” he concluded.