The Finance Brokers Association of Australia has called for the appointment of an independent actuary to investigate bank figures and improve transparency.
The association argued that an independent actuary should be given the task of looking into the “maths behind the numbers” that the major banks have used in relation to the cost of the ‘big bank levy’.
In the recent budget, it was announced that government wished to bring in a new levy for the five biggest banks (those with assessed liabilities of $100 billion or more) that would be calculated quarterly as 0.015 per cent of licensed entity liabilities.
According to the Treasury, the levy would bring in $6.2 billion over the budget.
While details of the levy have not been finalised, the ‘big four’ banks have released their estimates of the bank levy’s potential impact, which ranges from $220 million to $260 million (post-tax basis).
Westpac would pay the most under the levy, with their estimations coming in at $260 million a year (or $370 million pre-tax), while Commonwealth Bank would pay the least, with post-tax impact of $240 million (or $315 million pre-tax).
However, NAB and ANZ would pay the largest proportion in terms of net profit after tax (NPAT), with the levy making an impact of 3.6 and 3.4 per cent of their NPAT for the financial year 2018.
It is these figures that the FBAA has called into question.
FBAA executive director Peter White said: “Distinguishing fact from fiction is the major challenge. Are we getting facts from the banks?
“Maybe we need an independent actuary to look at the bank’s figures quoted in the media and their impact on shareholders, interest rates and additional fees and charges that may be forced onto borrowers, to get clarification of the real impact the government levy will have, and where.”
Mr White added that the major banks “fail to remember” that they receive a cheaper cost of funds by 0.17 per cent over what non-majors receive, as a result of government backing.
“We, as people and businesses, all have to pay our taxes and sometimes they go up whether we like it or not,” he said. “So why are the banks, who continually boast about how much money they make, complaining about having to pay their taxes?”
“We need to ensure they are fully transparent and accountable,” Mr White added.