Bankers battle against regional branch mandate
More branch closures are on the way for regional Australians after the big four bank chief executives battled against a push from Senators to mandate a minimum rural network, and CBA argued the annual $1 billion cost of maintaining its branch footprint was unsustainable given the declining use of cash.
In an at-times tense senate hearing, National Australia Bank chief executive Ross McEwan hit back at suggestions he was “out of touch with regional Australia”, as his company continues to close regional branches.
NAB is the only big bank not to agree to a request from the rural affairs committee to pause its branch closures while the committee investigates the effect this has on regional areas.
CBA chief Matt Comyn told the committee banking preferences had changed. Alex Ellinghausen
“We did consider it,” Mr McEwan told the committee chairman, LNP Senator Matt Canavan. “I’ve been involved in many countries where the same issues have been put forward and had moratoriums of branch closures… and the answer to that is that the branch closures happen as soon as the moratorium is off.”
The banks closed about 1600 branches between 2017 and last year, according to Australian Prudential Regulation Authority data. About 40 per cent of the closures were in rural areas, as the banks tally up the infrequent use of these services against the cost of running a branch.
But despite the sharp rise in digital banking, it has proved a big problem for businesses and older generations in these rural areas, especially those who are reliant on cash. Many of the 562 submissions to the inquiry mention having to drive hundreds of kilometres to complete basic banking services.
Commonwealth Bank chief executive Matt Comyn said it was unsustainable to
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