National Australia Bank is overhauling its complaints process for victims of dodgy financial advice amid growing calls for a royal commission into the sector.
NAB chief executive Andrew Thorburn says the bank will speed up customer complaints processes and bring in independent advisers to oversee any investigations and compensation payments.
The move comes after the bank’s confession on Friday that it had paid out up to $15 million to 750 customers during the past five years because of bad advice from NAB Wealth.
Opposition treasury spokesman Chris Bowen on Monday added his voice to calls by Independent senator Nick Xenophon, Nationals Senator John Williams and Greens Senator Peter Whish-Wilson for a royal commission into the industry.
Mr Thorburn said it was up to the government to decide whether to hold an inquiry, and he is committed to quickly fixing problems within NAB Wealth.
“If they decide on one, obviously we’re going to cooperate just like we did with similar types of initiatives in the past,” he told reporters in Melbourne.
NAB has sacked 37 financial advisers after they were found to have provided bad advice to clients.
The scandal follows similar cases at Commonwealth Bank and Macquarie Bank.
After those scandals erupted last year, a Senate inquiry recommended a royal commission, but this was rejected by the Abbott government.
Mr Thorburn said NAB had to “lift the bar” with a more transparent process for complaints about any of its 1,661 financial advisers.
He said the bank was going back and examining all the files of the 37 sacked advisers as part of a broader review to establish how many customers received bad advice.
“It’s clear we have some practices and standards we need to lift,” Mr Thorburn said.
“What we are going to do is when we see a problem, we will fix it. We have to be more proactive.”
Since the 2014 Senate inquiry, the government has established an industry-wide financial adviser register which the Australian Securities and Investments Commission expects to have up and running at the end of March.
Assistant Treasurer Josh Frydenberg also flagged last week the possibility of moving financial planners from a diploma-based qualification to a degree-base qualification.