Saturday , May 8 2021

Royal Banking Commission: CBA marks more compensation

It was a handwritten note from the chief executive who had revealed how far Australia's biggest banks were sinking in an effort to pursue profits.

And placing it correctly can harm millions of Commonwealth Banks.

The banking royal commission has heard CommBank knew for years selling consumer insurance policies but did nothing.

But even though CommBank Matt Comyn is currently in charge of the division that sells financial products, he said he really tried to fire them. Throwing his boss once under the bus, Mr Comyn said his predecessor in the top position, Ian Narev, repeatedly refused. And he said he had a record to prove it.

CBA may compensate more than half a million customers who sell consumer credit insurance products.

CommBank has paid $ 46 million to 154,000 customers for credit card sales and loan protection insurance errors.

Independent reviews in September raised concerns about the sales process or value of consumer credit insurance products for 374,000 other customers.

Mr Comyn said the Bank would extend the remediation program to cover those people if necessary, agreeing that it would likely have to compensate for a large number of additional customers.

The Royal Commission has heard CommBank knows about problems with credit cards plus its products and the risk of mis-selling loan protection products in 2015.

It announced that they had thrown out their credit cards and personal loan policies – but kept home loan insurance – in March this year, a few days before problems arose at the royal commission meeting.

Mr Comyn said he tried to get rid of them three years earlier when the head of CBA retail banking, said he was willing to cancel the $ 150 million bank made every year from consumer credit insurance products, reported AAP.

The April 2015 audit revealed 64,000 CBA customers sold credit cards plus insurance when they were unemployed and therefore were not eligible to submit claims.

Mr Comyn said he brought the matter to Mr Narev but after "enthusiastically pursuing" his argument he was rejected during the May 2015 meeting.

He produced handwritten notes, which were shown to the commission and photographed by Fairfax reporters. Under phrases such as "questionable customer needs" and "unclear pricing mechanisms" were the lines Comyn made directly to the CEO at that time.

Note Mr. Comyn stated Narev told him to "get angry at your sense of justice" when it comes to cutting down products. Slightly disturbed by the comments, Comyn said he thought it meant "calm".

"He refers to – I am enthusiastic about pursuing my argument, which I think is right. And he told me to be angry. "

Mr Comyn raised the issue again in 2016. "I am not persuasive enough," he said.

He acknowledged issues such as additional insurance sales errors and charging fees for no service, where the CBA paid $ 116 million in remediation, revealing banks prioritized short-term profits in front of customers.

"We don't prioritize customers enough," he said on Tuesday. "We don't understand the potential danger."

Mr Comyn said CBA had not had the right leader in the past. What now?

"We will see," he said. "I hope so. Yes."

Mr Comyn said the bank's culture must change and strike the right balance between delivering good results to customers and providing sustainable long-term returns to shareholders.

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