The Finance Sector Union (FSU) today called on the Federal Government to impose regulation upon the banks as news emerged that Australian banks would be exempt from the International liquidity agreement.

The Finance Sector Union fears that unless the banks adopt the Charter for Better Banking, which has high levels of support from the Australian community, and outlines five clear reforms that would benefit consumers, workers and ensure that banks aren’t operating entirely unrestricted.

The FSU’s National Secretary Leon Carter said that the Basel liquidity agreement was formulated to reign in the risky behaviour demonstrated by banks and financial services and cited as a contributing factor to the Global Financial Crisis.

“If, as Glenn Stevens from the RBA has managed to negotiate Australian banks’ exemption from these global rules, we must back up the push for reform with regulations of our own.

“From our extensive research with the community, we found that 77 per cent agreed that even if Australia’s banks did well during the global financial crisis, Australia is part of the world economy and we should be advocating for new, global rules to prevent high-risk banking activities.

The FSU calls on the Federal Government to act now to reform the banking sector and adopt the changes that Australian communities want to see in terms of reforming banking.

The Better Banking Charter outlines four key areas in need of reform:

Commitment from Government and banks to stop offshoring jobs and invest in developing skills in the Australian financial sector. (90% of public support and 93% workers support)

Government regulation to prohibit or significantly limit the extent to which performance can be measured by sales targets linked to selling debt products in the finance sector. (79% of public support and 90% of workers support)

Government regulation to require banks to reflect interest rate movements set by the Reserve Bank. (79% of public support and 90% of workers support)

Regulatory requirement for banks to demonstrate a direct link between their fees and charges and customer service provision. (82% of public support and 82% of workers support)

“Better banking is for everyone. Workers and communities cannot be left out of the picture when it comes to getting bank behaviour in step with both International reforms and to ensure that risky practices are made more sustainable,” said Mr Carter.

Spokesperson:  Leon Carter, National Secretary, 0409 946 597
Media:   Leanne Shingles, Media, 0423 821 773