Greens' bank plan may limit lending: Swan

Treasurer Wayne Swan says the Australian Greens' plan to rein in the banks on
interest rate rises could result in the rationing of home loans, hitting first time
buyers.
The Greens want to put a two-year ban on banks lifting their lending rates beyond
Reserve Bank movements.
The four major banks have just gone through a round of lifting their variable
mortgage rates by between 35 to 45 basis points, way above the Reserve Bank's 25
basis point official cash rate rise this month, sparking anger from all sides of
government and bank customers.
Opposition treasury spokesman Joe Hockey has led the charge for the coalition in
accusing the government of failing to stop the banks' from gouging borrowers, while
putting forward his own nine-point plan.
Mr Swan labelled the proposals as "cheap-jack opportunism", and that the government
will announce further banking reforms next month.
Still, while the major parties squabble, the Greens have jumped the queue,
presenting an amendment bill to parliament on Monday that includes regulating ATM
fees and requiring banks to provide a fee-free accounts.
Greens MP Adam Bandt told parliament the bill was necessary to protect consumers'
rights and allow people access to basic banking at a more reasonable cost.
"This bill is an important ... opportunity for those who have spoken so loudly in
recent weeks to put their money where their mouths are," he said."
The Greens will also pursue a two-year freeze on bank interest rate rises above
Reserve Bank increases.
"I believe that they're genuine in their approach but they will get the wrong
outcome. If you do what they want you will end up rationing credit and a lot of
people will miss out," Mr Swan told ABC radio.
But Mr Bandt rejected the suggestion.
"As a result of the support that the Australian public gave to the banks during the
global financial crisis, the banks are now doing quite well, thank you very much,"
he told reporters in Canberra.
One Monday, the Commonwealth Bank reported $1.6 billion in unaudited cash earnings
for the September quarter.
The bank's chief executive Ralph Norris said calls by politicians for more
regulation in the banking sector had raised eyebrows among international investors,
saying that Australia seems to be "regressing".
"On the face of it, it could be seen that there are groups of people that would like
to see Australia regress back to a much more closed and regulated economy," he told
analysts and reporters.
But he hoped some good came out of this debate.
The latest weekly Essential Research online survey found 68 per cent of people
believe there isn't sufficient competition among banks.
However, only 47 per cent said they thought greater competition would stop banks
from increasing their rates beyond that of the Reserve Bank.
When it came to who could be more trusted to deal with the banking industry, Mr
Hockey had a slight edge at 38 per cent compared to 33 per cent backing Mr Swan.