New rules costing banks $500m a year: Banking chief

Commonwealth Bank of Australia chief executive Ralph Norris said that the Federal Government’s banking reforms were costing his bank $100 million a year, and the cost to the whole banking industry would be more than $500 million a year.

"The amount of regulatory change is staggering, and so is the cost," Norris said.

"One really has to ask whether all these changes meet any reasonable social benefit-cost analysis."

The purpose of the present round of reforms is to make it easier for customers to compare products and switch banks, and includes measures such as banning exit fees on home loans, requiring banks to standardise mortgage product information and ensuring credit-card repayments are allocated to the most expensive part of the debt first.

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