The CEOs of Westpac Banking Corp (ASX: WBC) and Commonwealth Bank of Australia (ASX: CBA) are facing a grilling in the Royal Commission.
All of the big banks including National Australia Bank Ltd (ASX: NAB), Australia and New Zealand Banking Group (ASX: ANZ) and AMP Limited (ASX: AMP) are under the spotlight for their role in financial advice scandals.
The country’s biggest bank has already sacked 41 employees but there could be more pain on the way. The Consumer Action Law Centre has warned that ‘junk’ insurance policies could cost CBA and other providers over $1 billion.
The Royal Commission has also heard how the CBA Board approved bonuses to 12 high-level management totaling $14 million in a 10-minute meeting despite various problems.
Chairman Catherine Livingstone said of the bonuses, “We have all reflected on these outcomes, and would regard them as inappropriate.”
Westpac had to admit yesterday that didn’t yet know how much it will have to repay customers who didn’t receive advice because of poor record keeping.
CEO Brian Hartzer has mostly agreed this morning with the assertion that advisers were, “a distribution mechanism for wealth management products“.
Overall, Mr Hartzer thought that banks’ move into wealth management had not been successful, “At a high level clearly not“.
The Westpac share price is down 0.4% after Mr Hartzer’s appearance this morning according to Google Finance.
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