Big four banks not independent
New Australia Institute research has questioned the independence of Australia's big four banks and whether their large profits ultimately benefit the broader community.
The research, released today, claims that the big four banks make more than $1,460 in profit from every man, woman and child in Australia, and while some of that money flows to members of superannuation funds, most Australians get nothing.
The research, undertaken by Senior Research Fellow David Richardson, looks at the underlying ownership of the big banks and the influence major institutions exert as shareholders.
He looked at the top 20 shareholders of the big four banks and claims that the degree of common ownership seriously challenges the notion that they are independent.
"These institutions don't own a big slice of just one bank; they own a big slice of all the big banks," Richardson's analysis says.
"The last thing these common shareholders seem to want is genuine price competition and this week's interest rate decisions illustrate that.
"Australia's big four banks already make up four of the eight most profitable banks in the world," he said.
"Our analysis of the concentration of ownership raises serious concerns about the potential for them to boost profits further by acting as a monopoly.
"Australians who are worried about the cost of living should focus on the potential to make significant savings if they switched to a mutual, credit union or building society," Richardson said.
Recommended for you
Insignia Financial has announced the status of the two private equity bidders as due diligence comes to an end, with one bidder opting to pull out.
The corporate regulator has cancelled the AFSL of a Queensland-based financial services provider, having held the licence since mid-2016.
The financial advice industry has reacted to the appointment of Dr Daniel Mulino as the new Minister for Financial Services, with hopes for improvements in legislation and education standards.
With less than one-third of Australian business owners seeing an adviser, Business Health has detailed how advice practices can successfully target this underserved client segment.
