CBA has hit back at claims its takeover of Bankwest has added to decreased market competition.
The bank claims the consequences would have been disastrous for the banking system had CBA not acquired the regional bank.
Concern has been mounting in recent weeks that CBA’s acquisition of Bankwest, along with Westpac’s acquisition of St George, is diminishing competition in the banking sector.
A report released by CoreData in May showed the big four banks, post the two acquisitions, accounted for more than 70 per cent of all mortgage lending in the March quarter.
ACCC chief Graeme Samuel has also indicated he would have opposed the takeover of Bankwest should the market circumstances have been different.
Ralph Norris, CBA CEO, told The Australian today however that had CBA not taken over Bankwest, the market would have lost a significant player.
"… I think at the time we made the offer there weren't too many options for Bankwest; it was failure or being taken over," he said.
"…Competition issues, I think, had to be pushed to one side, because it would have been absolutely disastrous for the domestic banking system to have a bank fail.
"Confidence in the Australian banking system would have been significantly damaged."
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