ANZ ‘open to credit card interest rate and fee cuts’

ANZ Bank chief Shayne Elliott has raised the prospect of a cut to credit card interest rates to win back clients.

ANZ boss Shayne Elliott takes his turn in the hot seat.

ANZ Bank chief Shayne Elliott has raised the prospect of a cut to credit card interest rates to win back clients after apologising for blunders with thousands of customers amid a political storm over a royal commission into his industry.

Mr Elliott said he was open to reducing the rates as he came under fire for ANZ charging annual interest of 20 per cent on credit cards, after he had acknowledged the bank was generating higher returns on the cards than on other parts of its business.

“I think there’s an opportunity for us, frankly, to take a bit of leadership on this and do something better around, not just the interest rate, but also the fee structure on cards,” the bank chief told a parliamentary committee looking into the industry.

The comments came after Liberal National Party MP Scott Buchholz asked Mr Elliott whether he had an “appetite” to reward good customers who were paying too much on credit card debt.

In the second of three days of hearings into the banks, the ANZ chief admitted that 1400 superannuation customers had been victims of payment blunders and that other clients suffered from bad financial advice.

Mr Elliott said 45 financial planners had been reported to the corporate regulator and 40 of these had left the bank. “We do terminate people for poor behaviour,” he said.

Following a similar “mea culpa” from Commonwealth Bank chief Ian Narev, the ANZ chief admitted there were grounds for the public criticism of the banks.

“I think that as an industry we’ve lost touch with our customers. We have become too internally focused and forgotten our role in society and the community at large,” he said. “When we’ve lost sight of that, that’s taken us down a path that’s created bad behaviours and poor culture and not treating customers with the respect that they deserve. And that’s why we’re here — to explain that and say what we’re going to do about it.”

Mr Elliott denied that bank tellers were paid commissions to sign up customers for financial services but he conceded that incentives were paid, in some cases making up 10 per cent of the compensation for branch staff.

Labor MP Matt Keogh told The Australian that the hearing did not get a chance to explore whether other staff, such as those who took the customer referral from the branch, were given bigger incentives or commissions.

Mr Keogh said that showed the need for a royal commission to put more questions to the banks, given the concerns over conflicts of interest in financial advice.

In a shift since the questioning of Mr Narev on Tuesday, the committee took a more assertive approach to Mr Elliott yesterday to challenge him on the poor financial advice and the “blokey” culture of the banks.