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Scott Morrison warns against rash banking royal commission

Any significant reduction in lending would damage the economy and damage small businesses, he warned.

In a separate interview, Treasurer Josh Friedenberg repeated to the Prime Minister, saying that the government was inclined to accept all the recommendations of the report, but it would take a weekend to learn the fine print after receiving the results on Friday. He added that the pace of small business lending compared to last year was still below its historical average, and "therefore we must be very careful about the report that we ensure a free flow of loans."

Prime Minister Scott Morrison is campaigning in Brisbane this week.

Prime Minister Scott Morrison is campaigning in Brisbane this week.Credit:Dominic Lorrimer

Australian banks have recently tightened lending to companies and potential home buyers – which Morrison called the "partly instinctive reaction" to the royal commission.

The data of the Reserve Bank, published on Thursday, show that the total debt on housing obligations of Australian borrowers increased by 4.7 percent last year – compared with a growth of 6.3 percent a year earlier. Investor debt in housing construction grew by only 1.1 percent compared to double-digit growth rates in 2015.

“The easiest way to ensure that no one suffers is to lend money to anyone. But if no one lends money, then everyone will suffer. So I think we should be reasonable, ”said Morrison.


Large banks are concerned that the promulgation of the work of Commissioner Hein, so close to the federal election campaign, may provoke a strong reaction from both sides of the policy, since the industry is extremely unpopular in society, and the investigation has become a major political issue since Laborites first suggested this the beginning of 2016.

“What the royal commission has so far discovered is what they call non-financial misconduct,” said Morrison. “Thus, there are no problems with the stability of the system, but there are real problems with their behavior, and I fully understand that. But we must be careful. Be careful what you want. ”

The Prime Minister will go to the May elections, where Bill Shorten will pose a threat to the economy.

“Shorten was very popular in this matter, and he was not guided by sound financial policies,” he said. “He was just too enthusiastic, too fast to play a political card on all of this. But as the prime minister who was the treasurer, I understand that if you undermine your financial system, this is one of the worst things you can do with your economy. "


Shadow Treasurer Chris Bowen said that only Labor can be trusted to restore confidence in the financial sector.

“Labor also understands that the banking sector plays a key role in the heart of the Australian economy, but this should not be an alibi for bad banking or crime,” said Bowen.

Speaking during the outbreak of marginal locations around Brisbane, Mr. Morrison also said that Australia had experienced a global financial crisis thanks to the strength of its financial system.

“The reason we survived was not because Kevin Rudd blew up the budget, but because our banks continued to lend, and not one of them went bankrupt. In Great Britain and other countries, banks fell everywhere – the United States was a bloodbath. ” "

Mr. Morrison praised Judge Hayne for knowing that the situation on the credit market was toughening and adhered to the February deadline for completion.

The hearings began in March and ended in November, despite Labor’s appeals to extend the deadline to allow a wider audience and more of the 10,140 people and groups who submitted submissions, to express their opinion as a witness.

“I would absolutely reject any suggestion that the royal commission did not consider any of these representations,” said Mr. Morrison. "They have, and I think that the Labor proposal, which they do not have, is insulting to the royal commission and the work they have done."

Bevan Shields is the federal editor and director of the Canberra bureau The Sydney Morning Herald and The Age.

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