Banks must close the 'trust gap', says Westpac

Speaking to shareholders the bank’s annual general meeting, Westpac Group chair Lindsay Maxsted acknowledged there was “no doubt that there have been examples of poor behavior” within the system, but banks had nevertheless “overwhelmingly supported” the economy.

“In the midst of this criticism it is important to have a balanced debate and not lose sight of the positive contribution banks make to society,” he said.

Mr Maxsted said that Australian banks had not been a drag on the economy throughout the financial crisis, and that they had paid “their fair share of tax” throughout, while contributing an extra $4.5 billion in fees to the reserve bank “for a guarantee that was never used”.

“Ultimately, our banks make a significant contribution to support the economy. If we are to continue to support the country’s prosperity and growth, we must resist the negative and often self-serving rhetoric and continue to work constructively with our customers and communities,” he said.

Westpac chief executive Brian Hartzer said banks were actively working to close the ‘trust gap’ that had opened between banks and customers through a set of initiatives announced in April 2016, which aims to address concerns around remuneration, whistleblower protections, complaints and poor conduct.

“As an industry we’ve started these initiatives, not to stop a royal commission, but because they’re the right things to do,” he said.

Mr Hartzer said this focus on addressing customer concerns had been one of the drivers behind the company’s decision to remove product related incentives for branch tellers.

“While the year ahead will no doubt continue to be challenging, shareholders can be confident that [their] company will continue to make the changes needed to close the trust gap,” he said.

[Related: Westpac loosens mortgage lending for migrants]