Home / aus / Scott Morrison warns of a mindless response to the royal commission of the banking system

Scott Morrison warns of a mindless response to the royal commission of the banking system



Any major reduction in lending would harm the economy and harm small businesses, he warned.

In a separate interview, treasurer Josh Frydenberg told the prime minister that the government was inclined to accept all the report's recommendations, but that he needed the weekend to study the fine print after receiving the findings on Friday. He added the pace of credit to small businesses, while it was still below the historical average last year, "and so we need to be very aware of responding to the report that we guarantee the free flow of credit."

Premier Scott Morrison is campaigning in Brisbane this week.

Premier Scott Morrison is campaigning in Brisbane this week.Credit:Dominic Lorrimer

Australian banks have recently issued new loans to corporations and future home buyers, something that Mr. Morrison described as a "partly an almost instinctive response" to the royal commission.

Reserve Bank's banking data released on Thursday show that the total outstanding debts to Australian borrowers have risen by 4.7 percent last year – a growth of 6.3 percent a year earlier. The debt burden of investor homes grew by only 1.1 percent, a decrease compared to double digit growth figures in 2015.

"The easiest way to make sure nobody gets hurt is not to lend anyone money, but if nobody gets money, everyone gets hurt, so I think we should be wise," said Mr. Morrison.

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The big banks are concerned that the release of Commissioner Hayne's findings, which is so close to the federal electoral campaign, could trigger a reaction from both sides of politics, given that industry is very unpopular the public and research has been an important political problem since Labor made the first proposals in early 2016.

"What the Royal Commission has discovered so far is what they call non-financial misconduct," said Mr. Morrison. "So there are no problems with the stability of the system, but there are real problems with their behavior and I understand that completely, but we have to be careful, be careful what you want."

The prime minister goes to the May election in May Bill Shorten as a risk to the economy.

"Shorten is a rank populist here and he is not driven by sound financial policy," he said. "He was just too keen, too fast to play the political card on everything, but as a prime minister who was treasurer, I understand that if you undermine your financial system, this is one of the worst things you can do with you . economy."

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Shadow Treasurer Chris Bowen said that only Labor could be trusted to restore confidence in the financial sector.

"Labor also understands the crucial importance that the banking sector plays at the heart of the Australian economy – but that should not serve as an alibi for bad banking or crime," Bowen said.

Speaking at a blitz of marginal seats around Brisbane, Mr. Morrison also claimed that Australia survived the global financial crisis because of the strength of its financial system.

"The reason we survived was not because Kevin Rudd blew up the budget, it was because our banks borrowed and none of them went down." In the United Kingdom and other countries, banks were everywhere – the US was a massacre. "

Mr Morrison praised Justice Hayne for being aware of a tightening on the credit market and keeping to the deadline for completion in February.

Hearings began in March and ended in November, despite calls from Labor to extend the timeline to enable a broader scope and more of the 10,140 individuals and groups who submitted submissions to make their voices heard in the witness stand.

"I would absolutely reject any suggestion, the Royal Commission did not consider any of these comments," said Mr. Morrison. "They have and I think Labor's suggestion that they do not have it is offensive to the royal committee and the work they have done."

Bevan Shields is the Federal Editor and Canberra Bureau Chief for The Sydney Morning Herald and The Age.

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