ANZ takes aim at APRA

by Adam Smith10 Nov 2011

ANZ boss Mike Smith has taken aim at APRA, claiming the regulator's rules will make banks less globally competitive.

Speaking to investors, the bank's chief executive criticised APRA and the Basel III requirements, News Ltd has reported. Smith said future profits for the banking sector were in doubt due to uncertainty over new capital requirements.

Smith lamented the incoming Basel III capital requirements, which he said would require a $1.27 trillion recapitalisation. He predicted the global banking system could face a capital shortage because of the rules.

"That is a massive amount of money. If we have higher capital requirements and the rates of return go down, who is going to supply this capital?" he said.

"There's no doubt the regulatory uncertainty has created an issue with investors. Why wouldn't it? They are not sure how much capital banks are going to require. They are not sure about the costs of holding liquid instruments and how that will be different from one country to another," he said.

According to the Australian Financial Review, Smith also slammed APRA's decision to fast-track some of the Basel III requirements for Australian banks.

"[It] makes the Australian banks less competitive globally, and for what reason?" he asked.

Related stories:

Funding woes build for majors

Aussie banks follow international rules


  • by ChrisC 10/11/2011 10:14:00 AM

    I often wonder how these politicians and beauracrats can make any plausible decisions when clearly they do not know or have any understanding of how business actully works or how a whole industry cycles. The item in the Courier Mail last Monday front page says it all : Australian Small Business tied up and drowining in a minefield of compliance, or something like that.........on the "posisitive end" though ..... we must be proud of one of our fastest growing industries in Aut - our ever growing public servant brigade we need to keep shuffling all this paper.