The report's 76 recommendations set out to clean up the industry.One is for a new bank-funded compensation scheme for victims of banking misconduct.Some measures target the intermediaries who flog insurance, pensions and mortgages to befuddled Australians.
Mr Hayne wants their bonuses slashed, starting with "trailing" commissions paid to mortgage-brokers years after they sell a loan.Financial advisers would need customers' approval to roll fees forward. It would become illegal to tout pensions or insurance by phone.These are welcome measures, but many think they do not go far enough.
"In the end the banks have got off lightly," says Michael Rafferty, an economist at RMIT University in Melbourne.The commission exposed the harm to customers caused by conflicts of interest within banks.Yet it stopped short of demanding that they spin off the advisory and wealth-management units implicated in much of the wrongdoing.
Three big banks had expected such a ruling and are restructuring along these lines, yet forced separation would be "costly and disruptive", Mr Hayne concluded.Nor did he call for stricter checks on affordability before making loans.Lenders have already tightened up here, too, but consumer-protection groups fear they may ease up once the pressure is off.
Shares in the four big banks rose by an average of 6.7% the day after the report's publication.The commission accused industry regulators of being too cosy with the industry.It recommends that they be given more power to punish misdemeanours and curb bonuses,with a new oversight panel set up to ensure they do their job.Yet it is unclear how much authority the panel would have, and the corporate regulator has seen its funding squeezed."ASIC has been called out for its ineffectiveness since the early 1990s," complains Allan Fels, a former chairman of the competition commission. "What's different now?"
Both the coalition government, which looks set for an electoral trouncing in May,and the Labor Party, which is likely to form the next government, have promised to enact the commission's recommendations.Little will happen before the vote. But the commission at least gained a hearing from politicians.Banks can count themselves lucky it did not crack down harder.