Competition within the Australian banking sector

6 May 2011

© Commonwealth of Australia 2011
ISBN 978-1-74229-275-5

View the report as a single document - (PDF 2704KB)

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View the report as separate downloadable parts:

Membership of Committee	(PDF 8KB)
Acronyms	(PDF 4KB)
Summary and recommendations	(PDF 42KB)
The global financial crisis: stability and competition Banks' home loan interest rates Profitability and concentration in the banking industry Reducing barriers to customers moving between financial intermediaries Promoting more competitors The securitisation market Price signalling Supervision of the financial system Government guarantees for the financial system Taxation and related measures Small business finance
Chapter 1 - Introduction	(PDF 13KB)
Referral of the Inquiry Conduct of the inquiry Outline of the report
Chapter 2 - Background - the Australian banking market	(PDF 41KB)
Australia has strong banks A short history of Australian banking competition The impact of the global financial crisis
Chapter 3 - Past reviews and calls for a new review	(PDF 74KB)
Introduction Early reviews of banking competition The 1937 Royal Commission Campbell Committee Vic Martin Review Group Stephen Martin Committee Wallis Committee Recent parliamentary inquiries Calls for future banking inquiries
Chapter 4 - Assessing competition in the Australian banking market	(PDF 391KB)
Overview Number of products available and competitors Intensity of competition Measures of concentration in the Australian banking market The profitability of banks in Australia Measures of return on equity Interest margins Interest spreads Bank fees Barriers to entry Perceptions of competition Overview of competition Multi-brand banking Banking competition in regional areas Committee view
Chapter 5 - Home loan interest rates	(PDF 286KB)
Introduction Banks' cost of funds Loan rates and the cost of funds The repricing of risk Measuring home loan interest rates International comparison Tying home loan interest rates to the Reserve Bank's policy rate Committee view
Chapter 6 - Small business finance	(PDF 115KB)
Availability of credit to small business The cost of credit for small business Loan guarantees for small business Banks' service to small business customers Bank mergers and small business lending Better information about the sector
Chapter 7 - Moving between banks	(PDF 751KB)
Mortgage exit fees Other factors influencing inhibiting customers moving between mortgage providers Deposit account number portability
Chapter 8	(PDF 112KB)
What is price signalling? Why is price signalling a problem? The current law: a contract, arrangement or understanding The proposals for reform Committee view
Chapter 9	(PDF 88KB)
Merger policies generally Mergers among banks Four pillars Divestiture Encouraging new entrants Mutuals as a 'fifth pillar' Proposals for a new government bank Committee view
Chapter 10	(PDF 34KB)
Competition and unfair contract terms Mortgage early exit fees and unfair contract terms Unfair fees Bank selling practices Committee view
Chapter 11 - The prudential supervision of financial intermediaries and their social obligations	(PDF 115KB)
Competition and stability Are the major banks 'too big to fail'? Capital requirements presently Other current prudential requirements The new Basel III capital and liquidity requirements Banking 'licences' Mutual ADIs and banks Other financial institutions Bank holding companies and the 'narrow banking' model Social obligations of banks
Chapter 12 - Government guarantees and support	(PDF 110KB)
Government guarantees for bank funding Permanent deposit insurance or guarantee scheme Other government support for competitors to the major banks
Chapter 13 - Bonds: a key funding source	(PDF 231KB)
Securitisation The Australian Office of Financial Management programme Other proposals for government support of securitisation Covered bonds Fixed interest markets more generally Tapping superannuation
Chapter 14 - Competition in the payments system	(PDF 174KB)
Background ATM fees and access Competition in credit card markets Other aspects of the payments system
Chapter 15	(PDF 65KB)
Interest withholding tax Tax concessions on deposit interest income GST input taxing Franking credits LIBOR Cap Retirement Savings Accounts First Home Saver Accounts Increasing taxation on banking
Bibliography	(PDF 14KB)
Government Senators’ Minority Report	(PDF 53KB)
OVERVIEW Exit Fees Price Signalling Funding Sources Customer Information Financial System Inquiry Action Taken Exit fees Price Signalling RMBS Support for bullet bond markets Covered Bonds Bank fees fact sheet Other Bank Competition Issues Financial System Inquiry Other Recommendations Conclusion
Additional comments Senator John Williams	(PDF 9KB)
Additional Comments by Senator Xenophon	(PDF 28KB)
Bank profits up, but so are interest rates The need for a ‘fifth pillar’ ‘At Treasury, we won't save you’
Appendix 1 - Submissions Received	(PDF 18KB)
Appendix 2 - Public Hearings and Witnesses	(PDF 14KB)

For further information, contact:

Department of the Senate
PO Box 6100
Parliament House
Canberra ACT 2600
Australia

Phone:	+61 2 6277 3540
Fax:	+61 2 6277 5719
Email:	economics.sen@aph.gov.au