Mistrust of banks has become ‘entrenched’, says Turner

Addressing shareholders at the CBA annual general meeting (AGM) in Perth last week, chairman David Turner said the major bank’s strength and stability are “taken for granted”.

“It is an unspoken expectation that CBA is totally solid and safe, an ever-present profile. Its strength and stability are taken for granted. People see it just like gravity. It’s always there,” Mr Turner said.

“You don’t go to sleep at night and expect to wake up slapped against the ceiling,” he said.

Mr Turner, who will step down as CBA chairman at the end of the year, said the bank fully understands that strength and stability also comes from the trust and support which its shareholders, customers and community place in it.

“In recent times this trust has been questioned,” Mr Turner said. “And a sense of mistrust has become entrenched with certain quarters of the community.

“People ask me if we are concerned about the nature of the public debate. Of course, we are, and we are listening carefully. There is always the potential to undermine the confidence and the stability of the whole system which serves the country well.”

In an AFR news report published yesterday, Mr Turner said linked bank bashing in Australia leads to the social unrest that drove Brexit and the election of Donald Trump.

“People, when asked about executive pay, salaries, remuneration, size of the organisation, the power of the organisation … if you think back to why Donald Trump was elected or why people voted for Brexit, they could well say, “Well, here's an establishment issue that we just don't like,” Mr Turner told the AFR.

“And why don't we like it? Because there's some element of life that we feel is slightly unequal, that we're not totally happy about, and here's a part that, [banks are] a perfect target."

Earlier this month, Bendigo and Adelaide Bank chief Mike Hirst used the group's AGM to tell shareholders that the bank is well aware of “some community angst with regard to banks”.

“There can be no hiding the fact that there have been some examples of poor behaviour in the industry,” Mr Hirst said.

After slamming calls for a royal commission into the banks as “a significant waste of taxpayer and shareholder money”, the regional bank boss said much of the community angst arises when banks fail to pass on changes in the official cash rate to mortgage holders.

[Related: Bank educates borrowers amid community angst over rates]