The Federal Government says it will allow banks to give back cash to customers if they can prove they had no role in the financial crisis.
Key points:Bank of Australia says it’s not sure what role its customers played in the crisis, but will allow some customers to withdraw cashThey say it would be good for Australia to have a full recovery, but only if banks were to give it backThe banks will have to give their clients a full list of the money they have lent or pledged.
The Federal Government will introduce legislation in the coming weeks that will allow the banks to take some of the cash they are allowed to keep and put it into the accounts of their customers.
The measure is aimed at keeping the financial system solvent for the time being, and to ensure that people are able to pay their bills and take out loans, but the Government is not sure exactly how banks will comply with the new law.
“It’s a bit unclear to me whether banks will be required to return cash that they’ve lent to their customers to cover the cost of the bailout, or if they will be able to return that cash to their customer accounts and deposit it back into the banking system,” Senator Sarah Hanson-Young said.
“I’d like to see the answer to that before we move forward.”
Bank of America says it is still trying to understand what role the government wants it to play in the banking crisis.
“We don’t know the Government’s position, we’re trying to find out what their view is on that,” a spokeswoman said.
The spokeswoman said the bank had been told that the Government would be able make changes to the law if it became clear the banks had not acted appropriately.
“At this point, we don’t have any specific information about the Government position on this,” she said.”[We] are reviewing our processes to make sure we comply with that.”
Banks are currently exempt from the laws requiring them to give cash back to their clients, but Senator Hanson-Smith said it was a “very significant” issue for the banks.
“There is a large number of Australians who have lost their jobs and money,” she told the ABC.
“They don’t want to lose their money, they don’t trust banks, they do not trust banks to make loans.”
So, it’s a very significant issue for them.
“She said the banks would not be able return the money to customers unless they had “some form of compensation”.”
If you look at what happened with the mortgage industry and the mortgage loan industry, there was a lot of money put in to help them recover and recover quickly, and they were repaid,” she explained.”
And the Government needs to look at that, because we’re dealing with a very large amount of money, and the banks need to be compensated.
“The Government said it would look at the legislation in detail before making a decision.”
The spokeswoman also said the Government was looking at the options for the future, and whether the Government should consider “further measures” that would require the banks “to put in place specific mechanisms for ensuring their customers are compensated”.””
We recognise that they are the lifeline of our economy and that they have an important role in our recovery, and we are keen to see that role fully recognised.”
The spokeswoman also said the Government was looking at the options for the future, and whether the Government should consider “further measures” that would require the banks “to put in place specific mechanisms for ensuring their customers are compensated”.
“We will continue to work with the banks and others to ensure they have the tools they need to implement this legislation, but we will also be exploring what further measures we should take in order to ensure the recovery is successful,” she added.
Bank of England governor Mark Carney has warned that it is unlikely to be possible to make a decision on the future of the banking industry before the end of the year.
“This will be a long-term process, and as we get closer to that date, we will continue with the discussions,” he said.