Today the Gillard Government is announcing it will take further action to promote a competitive and sustainable banking system to give every Australian a fairer go.
We're introducing three broad streams of reform to empower consumers to get a better deal, to help smaller lenders put more competitive pressure on the big banks, and to secure our financial system so it can continue to provide a sustainable flow of credit to households and businesses.
We've worked carefully and methodically with our financial regulators to develop a package of reforms that will be effective and enduring, and won't let the big banks off the hook.
There's no silver bullet here – the challenges flowing from the global financial crisis can't be solved overnight – but we'll keep working hard to give all Australians a fighting chance.
Vigorous competition is the best way to keep interest rates for borrowers lower over time and create a system that offers real choice.
To empower consumers to get a better deal, we will:
To support smaller lenders so they can put more competitive pressure on the big banks, we will:
To secure the long-term safety and sustainability of our financial system, we will:
These reforms build on the Government's decisive action during the global financial crisis to secure our financial system and preserve the competitive foundations of Australia's banking sector.
The Gillard Government has worked hard to help smaller lenders compete with the big banks by supporting their access to vital funding sources including our deposit and wholesale funding guarantees and our $16 billion investment in AAA-rated RMBS.
We've also introduced tough new laws to crack down on unfair mortgage exit fees – to ensure that customers can walk down the road and get a better deal. Together with our measures making it easier for customers to switch their deposit accounts, this critical reform has been part of our broad agenda to promote choice for consumers.
A competitive and sustainable banking system is central to the Gillard Government's broad economic agenda, and continues our record of strong and responsible economic management.
The Competitive and Sustainable Banking System package is available at http://www.treasury.gov.au/banking.
12 December 2010