The head of Australia’s biggest and most profitable bank says reimbursing hundreds of millions of dollars in fees to its lower income customers would be an “appropriation” of shareholder money.
The Commonwealth Bank’s chief executive, Mat Comyn, mounted a fierce defence of charging fees according to its terms and conditions during a parliamentary committee hearing in Canberra on Tuesday morning,
Australian Securities and Investments Commission in July found that CBA – which reported a record cash profit of $10.3bn in the most recent financial year – and its subsidiary Bankwest charged about $270m fees to about 2.2 million low-income customers over five years. Those fees included account-keeping, dishonour and overdraw charges.
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While other banks, such as Westpac, have committed to fully repay what the regulator deemed “excessive fees”, Comyn was defiant.
“If I was you … I’d be looking at me and thinking, ‘Well you work for a financial institution, your institution makes lots of money, why don’t you just give that money back?’,” he said to Labor MP Ed Husic.
“I can certainly understand that.”
But he disputed Asic’s description that “every dollar” of the charges were “excessive”.
“They were charged in accordance with the terms and conditions. (There was) nothing improper about those charges.”
Comyn, who is one of the most influential business executives in the country, continued: “It’s not merely a question of just handing the money over. It’s, of course, not my or our money. It’s the money of our owners.
“And I think perhaps there’s a sort of harsher interpretation of how a shareholder may think of that, which is, well, it’s effectively appropriation of their property.”
The head of policy at Choice, Morgan Campbell, said Comyn had “got it backwards”.
“Before this money was in the pockets of Commbank shareholders, it was in the bank accounts of Australians on low incomes and it should never have been taken out,” Campbell said.
“His shareholders should never have had it in the first place.
“The other banks issued bulk refunds to at least some of their customers months ago. It’s time for Commbank to stop making excuses and put this right.”
While Comyn insisted the fees identified by Asic were not “unlawful”, there was some scope to make payments to some as a “goodwill” gesture.
Meanwhile, Westpac’s CEO, Anthony Miller, told the parliamentary committee that his bank was fully refunding nearly $10m in fees charged to low-income customers.
“We have agreed to refund those fees,” Miller said. “We are now proceeding through the cohort identified (by Asic) in July 2024.”
The Westpac boss confirmed that the bank would automatically migrate current and future eligible customers into these special low-fee accounts, and that people would need to opt out.
Miller said the full amount would be refunded by March next year.
