Speaking at the ASIC Annual Forum on Tuesday (20 March), Mr Harris reaffirmed the commission’s intent to investigate the impact that regulatory decisions have had on competition in Australia’s financial system.
Backing findings released by the Australian Competition and Consumer Commission (ACCC), Mr Harris claimed that stability-centred strategies from regulators have limited the potential for diversity in the sector, making particular reference to the inability for smaller lenders to increase their market share.
“Competition is heavily controlled by the actions of regulators, fierce competition is a risk to stability. This reinforces the market power of the larger banks,” Mr Harris said.
“To improve competitive opportunity, we need… to act at the source, which is the regulator level.
“We surprise some people with our willingness to go and look at the regulators, but they are a substantial force to the degree of competition in the marketplace.”
Mr Harris added: “We are a competition analysis [body], it’s clearly within scope.”
The commissioner claimed that delegating pro-competitive responsibilities to the Australian Prudential Regulation Authority (APRA) would be “wishful thinking”, and it called for the appointment of a “competition champion” to operate within the Council of Financial Regulators charged with ensuring that the market remains competitive.
“The most important conclusion we arrived at is: there is no party charged in this system [to] maintain reasonably competitive market conditions,” the commissioner said.
“There are plenty of parties who’ve got little bits of role in this area. No parties are specifically charged with [that] responsibility.”
Call for increased customer access to mortgage information
Mr Harris also called for the continued “real-time” publication of interest rate information to better inform prospective borrowers.
The chairman reiterated the PC’s draft suggestion that the Australian Securities and Investments Commission (ASIC) collect and publish the data to equip customers with the tools to negotiate a better rate on a loan.
“Consumers need more information — they need more useful information. [We] know the information is collected and available in real time within institutions. [We] know that information is available. It’s not difficult to collect in a world of digital data.
“It could be made available to ASIC to publish a regular series on this.
“Thus, people, when they are choosing to go for a home loan, would at least be informed by what people got last month, or close enough to last month, as close to real time as possible.”
Mr Harris added that the publication of such data would help ensure that banks and brokers work in the best interest of customers.
“[When customers] see [their] broker, it might actually help [their] broker to act in [the customer’s] best interest, because he or she will know you’ve got that information,” Mr Harris noted.
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Charbel Kadib is the news editor on the mortgages titles at Momentum Media.
Before joining the team in 2017, Charbel completed internships with public relations agency Fifty Acres, and the Department of Communications and the Arts.