(1 June 2018 – Australia) The Hayne Royal Commission has found that while banks have broken the law on numerous occasions in regards to small business borrowers no new laws are needed to improve their lending to the sector.
After two weeks of hearings into small business lending, Senior counsel assisting Michael Hodge, QC, made it clear that despite the banks poor lending practices, their actions were no more responsible for the small business failures than a shopping centre renovation or a global economic downturn.
ANZ, Westpac and BoQ were singled out for their focus on “relentlessly acquiring new business” when a more cautious approach to lending would have served the small business borrowers better.
Mr Hodge and Commissioner Hayne both took issue with the lip service the banks pay to customers by way of slogans such as “we are here to help” and “It’s possible to love a bank” but noted that such statements were not legal obligations.