Monday, 27 May 2013
Mallee Electorate: Banking
Long have I feared circumstances developing in my part of regional Victoria where some lenders have not behaved with decency and commercial common sense in addressing large debt exposure. For many years now I have been providing advocacy to many constituents where economic downturn has caused their businesses to struggle. I believe strongly in standing in the breach for enterprising constituents whose only folly is to overextend themselves in difficult economic circumstances. I have enjoyed some success in this with help from the Australian Bankers Association, and many thanks are due to their CEO, Steve Munchenburg.
Members of the ABA advise that negotiating the best outcome is the most sensible commercial option in these situations. Initially this involvement of mine was in relation to primary production, but of late has now involved commercial lending. I was extremely grateful for my Victorian state colleagues for legislating for compulsory debt mediation at my urging but it is now time to consider compulsory debt mediation for commercial lending as well. Both the ABA and its members agree with me that mediation can take a lot of pain out of the process and lead to sensible and commercial settlement of these matters. It forces the lender but most particularly the borrower to accept the fragile position that has developed. Sometimes borrowers can bury their head in the sand and this can lead to the lender taking unnecessary hasty action.
All 44 members of the ABA agree with me—except one bank. I am so close now to naming this bank for some of the unconscionable conduct that they perpetrated on my constituents. I have rung the CEO and advised him. An unbelievable level of arrogance at midmanagement level has developed at this bank and I am tired of it. All I ask for is that my constituents get treated properly and in a decent manner. I do not ask banks to forsake their security. The whole financial system would break down if we did that. Borrowers enter into commercial responsibilities and banks need to be conscious of that and honour it.
All I ask for is for this bank to comply with a protocol that has been established to the ABA and behave itself and comply with it. I have seen some terrible outcomes for my constituents—tragic outcomes in fact for my constituents—as a result of the bullying process that lawyers and liquidators can create by going the big biff, and I am tired of it. I am so close to naming this bank that if they do not lift their game, I will. Before I retire from this place I will show up at shareholder meetings and advise shareholders that this bank and the dividend it delivers is delivered out of the blood of my constituents. Behave yourself, do what the ABA recommends you do and what I have warned you to do.