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APRA to focus more on competition

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The Customer Owned Banking Association has congratulated APRA for agreeing to more actively champion the consideration of competition in its decision-making processes.

Customer Owned Banking Association CEO Michael Lawrence said competition is the key to improving customer outcomes in retail banking.

The APRA Capability Review Report released today has recommended APRA take a number of steps to support its consideration of competition. APRA has responded to the report by saying it supports ‘the objective’ of the recommendation and that all APRA members have overarching responsibility for achieving APRA’s mandate, including consideration of competition.

“COBA accepts that APRA’s role is not to actively promote competition but the regulator needs to more effectively and systematically consider the impact on competition of its decisions.

“The review finds that APRA should take a more structured approach to competition and it notes that APRA has been taking tentative steps towards doing this.

“This report and APRA’s response are very welcome.

“COBA’s key recommendations to the APRA Capability Review have been taken on board. These include for APRA to better balance competition with its other objectives, to accommodate different business models, to ensure approval processes are efficient and to consult about macroprudential measures.

“We are also very supportive of the recommendations to improve APRA’s accountability and we look forward to engaging with the Government on creating the new Financial Regulator Oversight Authority.

“Australia’s customer owned banking institutions are ready and willing to take on the ‘Big Four’ banks but we need a regulatory framework that delivers our sector a fair go.

“Stronger competition leads to better customer outcomes. The cure to misconduct is to create a more competitive market where customers can put banks on notice if they fail to meet expectations.”

A PDF version of the media release can be downloaded here.

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Mick Gibb
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