Some Interesting Facts – Domestic Banking Fee Income
The source is the Reserve Bank Bulletin which amazingly only has these figures correct to December 2007!
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Despite the fact that inflation since 1997 has risen around 3% per annum, bank fees should have risen 32%.
Transaction deposit accounts have gone from $416 million fee income to $1.6 billion that is $1,615 million not a 32% jump but a massive 400%.
Other deposit accounts went from $23 million in fees (not a 32% increase to $30 million) to $79 million which is a 350% increase.
Housing loans went from $290 million in fee income (not a 32% increase) to $899 million – a 300% increase.
Personal loan fee income $116 million dollars (again not a 32% increase) to $557million (500% increase).
Credit cards $134 million of fee income (not a 32% increase up $176 million) increased to $1,146 million dollars – a 900% increase!!
Total income has risen from $1,142 million (again not a 32% increase to $1.4), a massive jump to $4,376 million.
This is the biggest transfer of wealth in Australia’s history from you and me to the banks. I believe that they are out of control; I believe that there is no control. On the day that I was on 6PR with Howard Sattler, three banks on the same day announced a new fee on the use of other banks ATM’s. A coincidence?? Wouldn’t this point towards collusion and a monopolised banking system? The following day, the bank’s watchdog, the RBA, announced that it had no control over what the banks charged for the use of the ATM. What rot!
In August last year Swan announced that in relation to the banks not working with the Government, he had “weapons in our armoury” to control the bank. Where are those weapons Mr Swan? Your voters are hurting. These exorbitant credit card charges are a savage attack on the most vulnerable in our society. Ordinary Australians that can’t afford to maintain their living standards without the use of their credit card.
These people are slugged a massive 19% interest - not 3% - 5% as the more well off customers are, plus $30-$60 in fees every time there is a late payment, no payment or over the limit payment. How can they justify a 400% margin over the same money going to another borrower in the same bank? Doesn’t this demand a royal enquiry? An efficient economy needs an efficient banking system. Not a bloated banking system.
Let’s get some more facts; the banks also charge not only you but the merchants that you buy off. This is approximately 1%. This obviously gets added to the cost of goods and is inflationary. No action from the watchdog! Does the watchdog have teeth or has it gone to sleep?
Some more facts, of Australia’s seven most profitable businesses, four of them are banks. In other countries, the top ten most profitable businesses there is at the most one bank! Our banking system is taking too much money out of the economy at the expense of the economy.
Fact, our four banks CEO’s took a total of $20 million last year. Those suffering repayment difficulties under the weight of 19% interest will be saddened to know their hard earned money is going towards that $20 million.
Fact, the latest figures that I have just got from the RBA is the attack on credit card users. It’s not abating in fact the fees went up 18% in 2008! To quote Howard Sattler “how can we hold banks to account”? The answer is we need a royal enquiry. We have had one hundred royal enquiries in the past into all sorts of matters but not into the banking system. It is long overdue.
Some more facts, while these massive cost increases have been hitting, has the bank’s cost structure been rising to warrant it? No in fact, the complete reverse, as you know they have been shedding massive numbers of staff and closing branches. They have encouraged labour saving tactics such as penalties for over the counter transactions, encouraging people to use machines. Now that they have encouraged you to use their machines, they have come up with this beautiful new tax on using these machines!
Can I again quote Howard Sattler “how can we hold banks to account?” Please add your name to the petition calling for a royal enquiry into the banking system. An enquiry that should include what I believe is the failed crystal ball of the Reserve Bank. In an illogical, in my opinion, series of rate increases to supposedly reduce inflation they have seen massive increases in mortgages etc which have not reigned in inflation but caused it. This illogical action in my opinion, has simply made our banks the richest in the world. A failed policy or failed series of policies from the Reserve Bank.
Some more facts, the pre Christmas $10billion plus gift from Mr Rudd went where? Nearly $4billion of it went directly into savings accounts. These savings accounts have low balances and guess what? Our greedy banks either pay a very low interest rate or actually charge you for having your money in their account! So this measure was a great source of free funds for the banks. “How can we hold banks to account?” Please join in our petition.
