SYDNEY,. Australia’s Commonwealth Bank chief executive told a banking misconduct inquiry today that his predecessor had told him to curb his “sense of justice” when he suggested halting sales of potentially harmful insurance products.
Australia’s largest bank said last year it would have to refund about A$46 million (RM140.6 million) to 154,000 customers after selling them unsuitable insurance when they obtained loans or credit cards.
“’Temper your sense of justice’,” the bank’s CEO, Matt Comyn, said predecessor Ian Narev had told him in response to his advocacy for ceasing selling the products during a 2015 meeting.
“I was insufficiently persuasive,” added Comyn, the former head of retail banking who replaced Narev in April in the wake of a money-laundering scandal at the bank.
Narev could not immediately be reached for comment.
Comyn was testifying under oath for a second day at the powerful Royal Commission inquiry which has exposed widespread misconduct throughout Australia’s financial sector.
He is the first chief executive of a major bank to be grilled at the quasi-judicial inquiry.
CBA Chairwoman Catherine Livingstone is also expected to face questioning from leading barrister Rowena Orr on Tuesday, followed over the next two weeks by the heads of Westpac Banking Corp, Australia and New Zealand Banking Group, National Australia Bank, and investment bank Macquarie Group Ltd.
CBA stopped selling the poor-value credit-card and personal-loan insurance products in March this year, a few days before the Royal Commission began examining misconduct in the consumer credit industry.
Comyn said there had been a number of other examples where the bank had put profits ahead of customers’ interests, including charging clients fees without providing them with any services.
Comyn said the bank’s record of misconduct and poor culture showed CBA had not had the right leaders in the past.
“Do you feel that they have the right leaders now?” Orr asked.
“We will see,” Comyn answered. “I hope so.”
Yesterday he told the inquiry that senior compliance staff had felt vindicated when regulators accused the bank of thousands of breaches of anti-money laundering laws. — Reuters