The Murray Inquiry Into Australia's Financial System Is Out Today - Here's What You Need To Know

David Murray / IMF

The findings from the Financial System Inquiry are due out tomorrow with some key changes expected to be recommended for Australia’s banking and finance industry.

The inquiry head, former Commonwealth Bank CEO David Murray, wants the report to be a blueprint to foster a more competitive and flexible financial system.

Last week Treasurer Joe Hockey’s office received the report which could have some major ramifications for the country’s major banks.

One of the major issues the inquiry has looked at is the concept that Australia’s big banks are considered too-big-to-fail and must be supported in a crisis by the federal government.

There has been speculation banks may be required to set aside more capital and take on a larger share of risk in the event of another financial crisis.

The $1.8 trillion superannuation industry has also been canvassed in the inquiry.

Australians are paying billions of dollars in superannuation fees and Murray’s interim report which was released in July said there may not be enough competition in the sector. The final report is expected to include recommendations to address both issues.

With technology now playing a critical role in Australia’s financial system, especially with the emergence of peer to peer lenders including Society One and online adviser startups such as StockSpot, the report is expected to include recommendations to manage new types of risk and improve competition.

The investigation also looked at ways to sustain confidence in country’s financial system, how future growth can be funded, as well as how the industry can improve competitiveness and the current cost, quality, safety and availability of financial services.

Since releasing an interim report in July more than 6,5000 submissions have been received.

It’s been 16 years since Stan Wallis led a similar inquiry and 32 years since Sir Keith Campbell undertook the first major investigation into Australia’s financial system.

In 1981, the Campbell Report drove the floating of the Australian dollar and fuelled widespread industry deregulation. In 1997 the Wallace report drove further economic reforms and saw APRA established to monitor prudential standards.

Murray will be speaking at the Committee for Economic Development of Australia (CEDA) about the inquiry on Monday.

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