There are fresh calls for a royal commission into the New Zealand banking sector after Australian banks were slammed for gross-misconduct fuelled by greed.
It found customers were sold products they couldn't afford and even dead people were charged fees.
- 'It's out of order': Australia banking shakeup a warning for New Zealand
- Australian banks could face prosecution, damning report by Royal Commission shows
The royal commission report into the Australian banking sector was scathing and damning of its culture, calling it greedy, unethical and possibly criminal.
"In almost every case, the conduct was driven by profit and gain," it found.
It recommended wholesale changes, including banning commissions and tighter regulation.
"Banks understand these failures have caused deep hurt, suffering and heartache," says Australian Bank Association chief executive Anna Bligh.
Our four biggest banks - Westpac, ASB, ANZ and BNZ - are all owned by the Australian banks caught up in the review.
"You will continue to see the Australian banks making a fortune from New Zealand but I think New Zealanders are going to get wiser, I think there's going to be a lot more competition," says managing director of KiwiSaver provider Simplicity, Sam Stubbs.
After banks made $5b in profit combined last year he wants to see a New Zealand royal commission set up despite regulators here finding no extreme or systemic wrongdoing last year.
"The lesson we've learnt from the royal commission in Australia is the more you look, the more you find and in this case they found some really horrible things," he says.
Horrible things like taking fees and providing no service, charging dead people for insurance policies and selling products to people they knew couldn't meet the repayments.
And for that the Australian banks are looking down the barrel at multi-billion dollar fines.
"Effectively New Zealanders are going to help pay off the banks fines in Australia? That's what I'm really concerned about," Mr Stubbs says.
"Unless we pay particular attention to what the banks are doing that they will look at New Zealand the way they traditionally have - as a cash cow."
But on Tuesday Finance Minister Grant Robertson reiterated that there's no need for a royal commission here but will be keeping a very close eye on the fallout across the ditch.
Newshub.
