Economy

Royal commission report: Big bank stocks surge at ASX open

Royal commission report: Big bank stocks surge at ASX open”

The chief executive of NAB has promised to lead the bank's response to the royal commission "personally and visibly" after he and chairman Ken Henry were heavily criticised.

A yearlong inquiry into misconduct in Australia's financial industry uncovered a litany of scandals, including charging for services that were never provided, forging loan documents, lying to regulators and pushing customers into bad investments to meet bonus targets.

Commissioner Hayne says Mr Thorburn didn't take his findings seriously enough but the NAB boss says that's not the case.

The government says it will adopt all 76 recommendations made by Mr Hayne.

"That is, there remains a reluctance in some entities to form and then to give practical effect to their understanding of what is ethical, of what is efficient, honest and fair, of what is the right thing to do", the report said. "That is the Ken Henry I know, not the Ken Henry I read about in the Ken Hayne report".

"I can't confirm that [I will still have a job]", he said.

Meanwhile, the Australian Shareholders Association welcomed the report and said it expected the industry to work toward a similar outcome to the HIH Royal Commission in 2003, "where there is assurance that every industry participant has carried out their job or role in an ethical and effective manner".

The footnotes for the above quotes refer to the evidence given by Henry and NAB chief executive Andrew Thorburn.

"Dr Henry would go no further than saying that he wished NAB's board had stepped in sooner".

"It is possible that the banks may face criminal proceedings but we do not believe that any of the 76 recommendations by themselves will have a material financial impact", UBS analysts said in a research note.

Dr Henry and Mr Thorburn were accused by inquiry head Kenneth Hayne of being resistant to reform and unwilling to accept challenges to how the NAB board handled issues like fees for no service in the bank's operations. "The Royal Commission is just a sideshow for the events unfolding in the real economy", said Eleanor Creagh, Saxo Capital Markets' Australia strategist. Now, it seems they only "agree in principle" with the recommendations in the Final Report.

"I'm talking with you to try to communicate that I know what the plan should be and I'm committed to seeing it through". The Board has led a deep examination of our culture, governance and accountability.

/Public Release. View in full here.

"It is our highest priority for everyone at NAB to put customers first".

In a statement to the Australian Securities Exchange on Tuesday morning, both said they were planning to stay on, with Thorburn announcing that he had cancelled his planned long-service leave, which had been scheduled to continue for the rest of the month.

'At NAB we are determined to change and accept that we will ultimately be measured by the actions we take, ' Thorburn said.

NAB chairman Ken Henry addresses NAB's 2018 annual general meeting in Melbourne on Wednesday, December 19, 2018.

Among the financial planners, which would have to disclose the commissions they receive for selling wealth management products under the report's recommendations, shares of AMP Ltd and rival IOOF Ltd rose about 10.0 percent and 8.0 percent, respectively.

He said: "Now all the banks and financial institutions could sign that code of conduct today".



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