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Top 5 reasons we all love to hate the banks

Leon Carter

by Leon Carter

06 May 05:30am

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Filed under: Banks, Business, Finance, Lists, Politics

24 comments

The public is doing it. Even the PM is doing it. And the workforce don’t get a fair deal either. No matter how hard we try to warm to them, we just can’t help resenting the banks.

The Australian's Jon Kudelka

A new survey out today shows that the level of satisfaction with banks is low and that 63% people think that banks are getting worse at balancing profits and affordability.

Is it just another version of a national tall poppy syndrome, or are banks like those irritating over-achievers at school who just rubbed us up the wrong way for being obnoxious and successful? Or maybe there is a more simple reason – they can’t help acting badly.

1. Bank CEO salaries are bigger than Ben Hur – sure they run big businesses, but they are businesses that make money from our money. So when a glamorous CEO purchases a $9 million estate, we can’t help thinking she’s doing it with our money.

2. Exceeding the RBA’s interest rate rise to boost your banks’ bottom line is not a good look – perhaps that’s why 79 per cent of respondents to our survey supported government regulation on interest rates.

3. Making condescending viral videos is bananas - it does not support your cause. In fact any form of advertising and marketing that attempts to convince us that this bank is not actually a bank like all the rest does not wash.

4. Ordinary Australians’ debt levels have shot above GDP; but banks think you need more debt and will bully their staff to make sure you don’t forget it. In fact bank workers have pay rises tied to the amount of debt they sell you – something that 91 per cent of people think is a bad look.

5. Rather than boosting the workforce here, banks prefer to send jobs offshore to lower wages – and with the work goes your personal data to countries that do not have the same privacy protection as we enjoy here.

When you compare the solid half-yearly profit announcements from ANZ at $2.3 billion and Westpac at $2.9 billion to customer frustration at waiting longer in queues or online due to inadequate staffing; or customers feeling pressured to take up additional products when all they want is their question answered; it makes sense that everyone seems to be taking a hit at the banks.

Banks may bemoan the latest round of criticism as just another example of bank-bashing.

But the reality is that every institution is the sum of its actions – and when you look at the way banks make money, people struggle to see a public benefit.

And there is overwhelming support for banking reform:

  • 70 per cent think that people can be paid too much, and it’s time to cap bank executive salaries.
  • 87 per cent want to be warned before their personal data is sent overseas.
  • 91 per cent think bank workers should be paid for their professional customer service, not selling products.
  • 76 per cent want tougher regulation to stop personal debt from getting out of control.

That’s why the FSU believes its time to rebuild confidence in the banking sector. You can learn more and get involved at the Better Banking website.

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24 comments

Show oldest | newest first

    • John A Neve says:

      07:20am | 06/05/10

      Leon,

      Lets face it we made a mistake, we sold the state banks and the commonwealth bank, presumably we did not want or need them!!

      Now they are in private hands people whinge and moan!!!!  Many people either via their super or personally owned shares, get a return from the banks.

      Australia prides itself on being a democratic, free enterprise, upstanding community. This is a land the supports hard work and initative, so we should be proud of the banks achievements. If unhappy we should take our custom else where.

      Reply

    • Luke says:

      10:23am | 06/05/10

      The biggest achievement the banks have made is to convince us that overcharging and under servicing is what the customer wants and we don’t want to believe that they don’t have our best interests at heart. 

      It has never been cheaper to run a bank, yet there has never been more imposts and unjustified fees. Their patronising advertising campaigns are nothing short of offensive.

      We used to be protected by the Credit Act, but that has long been negated by clever marketing and changes to terminology; nevermind the insidious strategies designed to lure a customer in and make it very difficult to leave.  Admittedly they are targetting the unsophisticated customer, but isn’t that most of us?

      It has been going on long enough now, that the banks believe their own hype and why wouldn’t you?  When you are on a good thing….....

      Just exactly where should we take our custom?  We should be marching in the streets!

    • John A Neve says:

      11:12am | 06/05/10

      Luke,
      You ask “where should we take our custom?”
      I haven’t had a bank account since 1975, I switched to a credit co-op they have served me well.
      House loans, car loans, fexibility and cheaper, there other options than banks.

    • Others Man. says:

      07:35am | 06/05/10

      Dear Leon, the worst, most evil, betrayal of “Joe Public”, “The Workers”, “The Little Guy”. That has been committed by the red/green/getup/labour coalition over the last 2 years was when they gave taxpayers money to the biggest 2 pillars, so that they could take over competitors Bankwest & St George.

      Now we have 2 pillars & a couple of stumps, as the other 2 major banks said, but only because they were jealous & didn’t get there first. If anything the government should be going in the opposite direction.

      One option would have been to encourage a merger between those minors, so that we could have had 5 pillars. Bankwest plus St George & BOQ or Scumcorp could have given us another major.

      That plus more minor regionals would, through more competition, “keep some more of these barstards honest”.

      It is an enormous mistake however to be proposing more regulation of banks or salary caps for their CEOs. What we need right now is greater regulation of ALL big business, salary caps for ALL CEOs.

      The equivalent of supermarket “unit pricing” for ALL providers of goods, services, receivers of salaries & bonuses. This could be achieved quickly & easily with a discount on corporate taxation for “good behaviour” or being a “good corporate citizen”.

      i thought of this years ago when i was driving my OWN little maxi taxi.

      Why the Major Mistakes can’t think of better ways to govern is beyond me?

      Why they continue to support the creation of poverty, so that the rich can get richer & the poor, poorer is beyond me?

      http://www.australiafirstparty.com.au/cms/

      http://www.dlp.org.au/

      http://www.democrats.org.au/

      http://australianpolitics.com/parties/list.shtml

      Regards the Former snag & swinging voter.

      Reply

    • james says:

      12:49pm | 06/05/10

      go back to the USSR, we have a free market here, they get paid shitloads because it takes a lot of hard work to get to that level. get off your arse and go to university or work harder, and then you might get a bigger slice of pie.

    • Seano says:

      02:51pm | 06/05/10

      Everytime I read your posts I hear the Benny Hill Theme song, strange.

    • Luke says:

      09:15am | 06/05/10

      CEO’s suck!!
      When the business does well?
      “our intelligent decisions allowed our business to do well hence we deserve a bonus”
      When the business does poorly?
      “market factors were beyond our control hence, it is not our fault business is not doing well, we still worked hard… we still deserve a bonus”
      When business is ordinary?
      “the government hasnt responed to our demands… we have worked hard to get as much business as we can, we deserve a bonus…”
      Tell me Mr CEO… when do you NOT get a bonus?? I thought the whole idea of a bonus was that it was EXTRA MONEY, not EXPECTED MONEY??
      Tell me ONE BANK CEO that reduced his bonus doing the GFC?? A problem that the ceo’s must take atleast SOME responsibility for??
      Maybe if all bank CEO’s just didnt take a bonus for that ONE year, put all the money they would have had to prop up the market… could the whole GFC have been avoided?? You know… NO BONUS CAUSE YOU DIDNT DO YOUR F^$@%@# JOB???

      Reply

    • cityboy @ Sydney says:

      10:39am | 06/05/10

      Bank shareholders should be able to cast a binding vote on Directors and CEO salary packages, instead of the ‘non-binding’ vote which is ignored if it is not to their liking. Shareholders are just as angry as the bank customers at the obscene ‘remuneration’ these greedy people award themselves each year.
      Imagine if you could tell your employer how much pay you will have for the next year!

      Reply

    • facepalm says:

      11:14am | 06/05/10

      There’s only one reason why I hate banks. It’s because they’re completely unnecessary, yet most of society seems to think they are. With that kind of power over people, I can’t help but be reminded of religion.

      Reply

    • marley says:

      02:52pm | 06/05/10

      Mmm.  So you saved your money for years, kept it in a sock under your mattress, and then plonked it all down and bought your house for cash?  I’m impressed.

    • facepalm says:

      04:29pm | 06/05/10

      What can I say marley, I have big feet [/sarcasm]. I take it you see nothing wrong with banks lending you money they don’t even have through fractional reserve practices, and expect you to pay it back with interest on top? What I was rather subtly alluding to is that people today (and for a long time now) are so thoroughly brainwashed into accepting money as a necessity in present society to the extent that they cannot imagine how to build a world without the stupid stuff (or if it is even possible). It’s why I regard money as the most dominant religion on this planet - most of its followers are ignorant as to its inner workings and dogmas, it claims to help people yet is responsible for unimaginable suffering., and most of the congregation dare not to question its existence.

    • marley says:

      07:35pm | 07/05/10

      I know what you were saying (and I tried not to mention anything about the size of your feet - be grateful for that at least).

      The fact is, we do need banks or something like banks, unless we are prepared to live in a totally cash-and-barter economy.  I’m not an aficionado of some of the practices of Australian banks, but at least they’re solvent.

      I’ve lived in a couple of countries where banking as we know it was just about non-existent - you couldn’t get a mortgage or a loan, you couldn’t buy a house or get money to set up a business, everything had to be cash in hand.  And the economies were disasters.  Someone might have a great job or a rock solid plan for expanding his business and hiring more people, but without a banking system there was simply no way for him to get money to buy a house or open up another outlet - unless he went to a loan shark (and they exist everywhere - which in itself tells you that there’s a need for these kinds of services). If you wanted to buy US dollars (because the local currency was worthless beyond the local borders) you went to a guy selling currency in a booth on the street.  And he wasn’t giving generous exchange rates.

      So no, I have no problem with paying interest on money I’m borrowing, if it means that I can acquire an asset I think worth investing in.  Oh, and by the way, I don’t mind getting interest on money I’m depositing either.

    • facepalm says:

      04:58am | 09/05/10

      marley, you have inadvertently demonstrated my initial point about money being a religion. You are a thoroughly indoctrinated acolyte.

    • facepalm says:

      04:02am | 10/05/10

      I also find it laughable that you think of interest as your friend. It isn’t. It’s one of the most insidious forms of wealth redistribution in existence. It is well established that an overwhelming majority of people will end up paying more interest on their debts than they earn from their savings - you essentially have to be a multi-millionaire before interest actually starts to earn you money.

    • Bruce says:

      11:54am | 06/05/10

      A strong banking system usually translates to a strong economy. A weak banking system usually equates to a weak economy. I know which option I would prefer. I do not particularly like paying high bank fees. However, in balance I also get stung with high accountants fees, solicitors fees, dentist fees, doctors fees, or any other professionals costs. I also dislike excessive margins and over pricing when we buy a car, furniture, electronics, food and groceries etc. I also find it even more offensive when I hear about the lurk and perks many public servants get. But thats the way it is !! I believe the only way to solve the problem is: “If you do not like it, go somewhere else”

      Reply

    • Mike says:

      12:10pm | 06/05/10

      I read with interest that there are other option other than banks, such as credit cooperatives. Where can one find such information? Googled but didn’t get anywhere.

      Reply

    • Seano says:

      12:40pm | 06/05/10

      Obviously the self regulating banking industry don’t give a toss about Australia or Australians (well unless those Australian’s are shareholders).

      Honestly I think banks should be able to make as much money as they possibly can but with a few, reasonable checks and balances. One I would like to see is that they not be allowed to send your personal data OS.

      Reply

    • Jenni says:

      12:43pm | 06/05/10

      I was unfortunate enough last year to be off work with no pay for close to 10 months due to injury. In that time I came perilously close to losing my house, partly because I did not have income protection insurance (yes, I accept responsibility for that decision) but largely because my bank - ANZ - neglected to tell me, when I first began experiencing difficulties - that I had mortgage protection built into my home loan.

      Again, I accept partial responsibility for not being aware of this fact (despite it being written in small print at the bottom of page 37 of a 48 page document). However, don’t you think it would be in the BANK’S best interests to advise me that my mortgage was actually covered if I just submitted maclaim? Or would they actually PREFER to foreclose on my house for the full amount, rather than payout a claim for 10 moths repayments?

      But wait - it gets better! When *_their own mortgage protection agency_ was a little slow in processing my claim, thereby delaying payment on the loan, the bank filed against me in the Supreme Court for the full mortgage amount. Rather than communicating with their own department over why they had not recieved a cheque yet, they handed over my file to a third party legal firm to sue me, and then refused to deal with me any further. This took close to three months to sort out, nearly gave me a nervous breakdown due to stress, and - despite this part being in no way my fault - left me with an additional $7500 to repay to the bank on third party legal fees.

      I have now been back at work for approx 6 months, and the drama continues. Even though I began making repayments again as soon as able, I recieve notification almost EVERY fortnight that my mortgage is - yet again - in arrears. This again costs me time and money to phone and sort out, and in EVERY case it has turned out to be an error at the bank, most times because of lack of communication between departments - apparently different parts of my mortgage file and history are held in different comupters and there is no way to cross-reference them?

      Every time this occues I recieve a “so sorry for the inconvenience, we’ll look into the reasons behind the error, blah blah” ... and then 2 weeks later the same thing happens again.

      Oh, and if you’re wondering why I don’t move my home loan to another insitution? It’s because the fiasco of the ANZ unneccessarily taking Supreme Court action against me, my credit rating is now in the toilet and nobody will touch me with a ten-foot barge pole.

      Reply

    • dancan says:

      12:50pm | 06/05/10

      If you ask yourself.  If this company wasn’t a bank and therefore almost necessary in todays day and age and with its track record, would they still be in business?  The answer is no, no one would deal with them.

      Reply

    • MF says:

      02:43pm | 06/05/10

      “76 per cent want tougher regulation to stop personal debt from getting out of control.”

      I bet that same 76% will then have a good old whinge when the bank rejects their loan application because of those “tougher regulations”.  WTF happened to personal responsibility?

      Reply

    • common wealth says:

      07:01pm | 07/05/10

      Being a retail bank worker with a lot of years in the industry, I believe stricter regulation needs to be imposed on credit card applications and limit increases. No income doumentation or liability verification is required to get a credit card approved, and automatic limit increases are handed out like candy. People are carrying credit card debts the size of small home loans and will never pay the debt off in their lifetime. Self discipline and product awareness is vital, and should be the responsibility of the individual. Sadly banks prey on people’s ignornace and gullibility, and make many a bank worker’s life a misery if we dare try to educate and encourage our customers to save rather than buy today.

    • cyclone says:

      07:47pm | 06/05/10

      Try being an employee in the bank and told that you are not selling enough and if you don’t lift your sales your job will be under review. i believe and always will that i am there to serve the customers and structure their banking to minimise fees and to help them arrange their banking to best suit THEIR needs not the banks and I WILL NOT CHANGE MY VIEW i have over 24 years experience. and yes we do get bullied for sales and yes it is VERY STRESSFUL. so when you go into your local branch just remember that we all have to work somewhere and it is not that easy to get another job i know i’ve been trying for a long time.

      Reply

    • Lilian says:

      04:01pm | 31/03/12

      “Australia’s first bank” is very different to “A bank of Australia” . Who really owns the four pillars is a very important question??? millions have put their cash into the system and have been given elaborate reasons for the magical disappearing act. I was one of the ones trained to provide the spiels. Have you checked you super lately?  that sum of money that kept Australia from being destroyed by the GFC? Hey presto! it’s disappearing. Add a little debt here and there ,a few credit cards per person. In no time, Aussie wealth will be a thing of the past.

      Reply
 
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