Two key reports released on Friday by the Banking Code Compliance Committee (BCCC) contain important findings for the industry, including:
- Significant concerns about the reporting of breaches under the 2013 Code of Banking Practice during 2018-19.
- Banks will need to continue ongoing efforts in order to meet the BCCC’s expectations and the higher standards of the new 2019 Banking Code of Practice.
The report on Compliance with the Code of Banking Practice 2018-19 shows that Code subscribing banks reported over 15,500 breaches of the 2013 Code in 2018-19, affecting at least 9 million customers and with a financial impact of more than $90 million. While this is a 54% percent increase in the number of breaches reported compared to the previous year, questions remain about the quality of some banks’ compliance frameworks and their capacity to identify, record and report Code breaches.
BCCC Chief Executive Sally Davis expressed concern about banks’ ability to report timely, correct data as they transition to the 2019 Code, which came into effect on 1 July.
“Banks must accurately report when they fall short of the Code,” Ms Davis said. “A considerable amount of work needs to be done if banks are to meet the BCCC’s expectations for the new reporting standards of the 2019 Code.”
This correlates with the findings of the BCCC’s report intoBanks’ transition to the 2019 Banking Code of Practice, which outlines that while transition to the new code was a major priority for all banks in the lead-up to its implementation on 1 July 2019, the BCCC has significant concerns about compliance in several key areas.
A number of specific recommendations for banks to achieve good practice and ensure ongoing compliance with the 2019 Code are set out in the report, with a focus on issues including:
- senior executive oversight of compliance
- staff training and key performance metrics
- inclusive and accessible services for all customers
- customers experiencing vulnerability, and
- treatment of small business and farming customers.
The BCCC will work closely with individual banks, the Australian Banking Association, consumer groups and small business representatives on an ongoing basis to facilitate greater compliance with the 2019 Code.
In light of the ongoing community concern about the quality and fairness of banking services, the BCCC intends to use its sanction powers to name individual banks publicly if they fail to adequately change their processes in a timely manner when serious breaches are brought to their attention for rectification by the BCCC.
Details about the BCCC and its work are available on its website.
BCCC Media Release 29/11/19