Morrison’s BEAR trap unfairly demonises our banks

Today in The Australian

Scott Morrison’s proposed Banking Executive Accountability ­Regime (BEAR) seems designed to neutralise Bill Shorten’s call for a royal commission into banking.

About Henry Ergas

Henry Ergas AO is a columnist for The Australian. From 2009 to 2015 he was Senior Economic Adviser to Deloitte Australia and from 2009 to 2017 was Professor of Infrastructure Economics at the University of Wollongong’s SMART Infrastructure Facility. He joined SMART and Deloitte after working as a consultant economist at NECG, CRA International and Concept Economics. Prior to that, he was an economist at the OECD in Paris from the late 1970s until the early 1990s. At the OECD, he headed the Secretary-General’s Task Force on Structural Adjustment (1984-1987), which concentrated on improving the efficiency of government policies in a wide range of areas, and was subsequently Counsellor for Structural Policy in the Economics Department. He has taught at a range of universities, undertaken a number of government inquiries and served as a Lay Member of the New Zealand High Court. In 2016, he was made an Officer in the Order of Australia.
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11 Responses to Morrison’s BEAR trap unfairly demonises our banks

  1. John Constantine

    Once victoria deindustrialises through ruinables inside the next decade, the banks will retreat to being social justice public service credit unions, handing out car and holiday and reno loans to public service employees.[ and welfare herds.]

  2. Dr Faustus

    The BEAR requires that 40% of senior executives’ performance pay is held back for 4 years to combat ‘short term’ and otherwise rubbish decision-making:

    1.63 The BEAR imposes a statutory obligation on an ADI or subsidiary to defer a percentage of an accountable person’s variable remuneration. It ensures that accountable persons have clear incentives to make decisions which account for longer term effects. It also ensures that accountable persons are properly held to account for those decisions that have negative future consequences.

    Either no shame, or self -awareness. Parliamentarians never engage in short-term or rubbish decision-making with “negative future consequences“.

  3. Bruce of Newcastle

    For politicians suffering from voter revolts the banks are a useful squirrel.
    Squirrels also like to hoard acorns.
    The banks have lots of acorns squirreled away that politicians can steal tax.
    And a good stoning is a useful distraction for the voters.
    So long as the politicians aren’t the stonees.

  4. True Aussie

    Why not a BEAR and a royal commission?

  5. Baldrick

    When are our politicians going to he held accountable?
    Good for thee but not for me.

  6. notafan

    Both are a nonsense

    either do some deregulation or leave them alone

    Profit bad taxes good!

  7. Myrddin Seren

    What’s really going to hurt is when the Turnbull United Party starts another huge ad buy to point us at another useless website touting how the agile and innovative TUP has saved everyday Aussies from predations of the evil and usurious banking types.

  8. Mitchell Porter

    Banking question: is it a sign of corruption that Glenn Stevens is now working for Macquarie?

  9. Myrddin Seren

    Banking question: is it a sign of corruption that Glenn Stevens is now working for Macquarie?

    Bob Carr was making $500 kpa on retainer for the Maccas.

    An investment well spent when The Factory was haemorrhaging deposits in the GFC and Bob flew to Canberra to convince his New Best Friend, capitalist-hating Kevin Rudd to bail ‘the banks’ out with the deposit guarantee. Which no other bank except Macquarie needed.

    Good times, good times.

    I am sure Glenn’s moment in the sun will come too.

  10. John Bayley

    Which no other bank except Macquarie needed.

    That’s actually not true, you know.
    I have no special love for Macquarie, but *all* the major banks had, and still are to a large extent, been borrowing overseas from short-term funding sources to fund long-term lending (mortgages).
    Because of that, they were *all* effectively insolvent once those funding sources dried up, in the same way that Centro Properties (remember them?) ended up.
    Mind you, any fractionally reserved bank – meaning all of them – is effectively insolvent at any given time. But that’s another story.

  11. Infidel Tiger 2.0 (Premium Content Subscribers Only)

    The way Australia’s banks carry on (Adani anyone?) they should all be smashed to smithereens.

    They deserve no quarter and a Royal Commission followed by a break up is essential.

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