Skip to main content
Financial Assistance Hub

Banks will ensure staff pay structures put customer interests first

24 September 2016

Sydney, 23 September 2016: The Australian Bankers’ Association has provided its submission to Mr Stephen Sedgwick’s independent review of commissions and payments in retail banking, confirming the industry’s commitment to meet changing expectations.

“Banks are providing detailed information to Mr Sedgwick to assist him conduct his independent review,” Australian Bankers’ Association Chief Executive Steven Münchenberg said. 

“Banks have heard that the community wants change and we are responding. We want customers to be confident our staff are not paid in ways that encourage them to put their own interests, and the bank’s, ahead of what is best for the customer,” he said.

“The independent findings will be important for banks to build on the changes already made in recent years to how they pay staff, such as rewarding employees for providing good customer service and for behaving ethically.” 

The ABA submission sets out the industry’s reasons for establishing the independent review and confirms our commitment to remove or change any product sales commissions and other product based payments identified which could misalign with customer interests.

Mr Münchenberg said the Terms of Reference made sure the findings of the review would be evidence-based, with clear recommendations on action that should be taken. 

“We want to hear from the reviewer whether there are payments which should be removed or changed, and if there are, what options are available for the industry to take collective action,” he said.

“There are complex legal constraints on what the industry can say and do. Banks cannot share commercially sensitive and confidential information, nor agree to take collective action on how they pay staff because they are competitors and must act within the law.” 

The ABA submission includes legal advice that a joint initiative to address potentially conflicted pay structures would likely run foul of the Competition and Consumer Act 2010. 

“We therefore require authorisation from the Australian Competition and Consumer Commission, or similar regulatory approval, if the industry wishes to work together to agree on and implement changes to pay which build on the Future of Financial Advice reforms,” Mr Münchenberg said. 

A copy of the ABA submission is available here.

ENDS

Contact: Stephanie Arena 0477 470 677

@austbankers

bankers.asn.au

Latest news

1 / 3
Transcript
Anna Bligh interview on 2GB Afternoons with Michael McLaren
22 April 2025

Michael McLaren (Host): Well, here we are at the Easter Show, the great celebration of country life in the city, but it’s also an important platform this to better understand the challenges that the regions face. Now, yesterday, we looked at the floods. Today, I want to look at the banks. Now in the regions,… Read more »

Read more
Media Releases
Banks continue to support FNQ flood recovery efforts
3 April 2025

The ABA is reminding customers across North and Far North Queensland that they don’t have to tough it out on their own, as they continue to recover from February’s severe flooding event. ABA CEO Anna Bligh recently met with Queensland’s State Recovery Coordinator Andrew Cripps to discuss how banks can assist customers facing financial difficulty… Read more »

Read more
Media Releases
Banks offer support to customers impacted by flooding in western Queensland and parts of NSW
2 April 2025

Banks stand ready to support customers in western Queensland and parts of New South Wales affected by heavy rainfall and flooding. ABA CEO Anna Bligh said customers don’t have to tough it out on their own and banks have a range of practical measures to assist those facing financial stress. “This is a challenging time… Read more »

Read more