- Andrew Thorburn, the CEO of the NAB, is appearing today before a federal parliamentary committee.
- He says the issues in the bank exposed by the financial services royal commission have been “confronting and upsetting”.
- He outlined changes inside banks over the last 30 years which shifted bank behaviour away from customers.
NAB chief executive Andrew Thorburn, the last of the big four bank chiefs to appear before a federal parliamentary committee, says the banks had grown to put “profits before people”.
The financial services royal commission has described the behavior of the banks, including charging fees for no services, as dishonest and based on greed.
Today Thorburn described royal commissioner Kenneth Hayne’s interim report as “fair and balanced”.
“The Royal Commission has exposed issues in our bank, and our industry, that have been confronting and upsetting,” he says.
“I feel this deeply, having worked in our profession for more than three decades.”
He joined the other CEOs to again apologise.
“In so many cases we have not had the care and respect for our customers that we should have, and for that I am sorry,” he says.
He outlined what he called four significant changes inside banks over the last 30 years which caused a shift in bank behaviour:
- The main focus shifted away from customers to “profits before people”.
- A move from a long-term view to a short-term one.
- A move from base pay to incentive compensation which then rewarded the wrong behaviours, and focused on product sales and short-term growth.
- The banks became bound by internal rules, policies, regulation and legacy systems, leading to inertia and the loss of local connections with customers.
“This drift away from what banking was when I first started has been real, and it will take time to return to the place we need to be,” says Thorburn.
“We have a long way to go to once more be the bank we want to be for our customers.”
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