The Hayne Royal Commission handed in its final list of recommendations this afternoon with various news wires reporting that a total of 76 new recommendations have been made.
Some of the key recommendations are listed below:
- APRA / ASIC to have a new oversight body consisting of three persons, capability reviews of regulators every 4 years
- NAB's CEO Andrew Thorburn and chairman Ken Henry have been slammed for their attitude to the Royal Commission and its criticisms
- More than 20 referrals of major financial institutions have been made by the commissioner to the regulators ASIC and APRA for breaches of the financial services laws and regulations
- The mortgage broking industry is set for a substantial overhaul, with the Mortgage Choice Limited (ASX: MOC) share price already down more than 50% over the past year
- The insurance sector is set to be reformed. For example the "hawking" of insurance products or "cold calling" to sell products will be banned. The Freedom Insurance Group Ltd (ASX: FIG) share price is already down 95% over the past year. Hawking or cold calling is also to be banned for superannuation products.
- Superannuation fund members to only have one account for new members entering the system
- The vertical integration business model whereby financial advisers sell products issued by other parts of their employer's business is likely to be reformed as a conflict of interest
- As with the interim report, ASIC has been told to toughen up its approach to litigation rather than seeking "negotiated outcomes" with miscreants
The lack of bombshell or unexpected recommendations is likely to provide relief to investors in the big banks like Commonwealth Bank of Australia (ASX: CBA) and Westpac Banking Corp (ASX: WBC), although the future of the National Australia Bank Ltd (ASX: NAB) CEO is brought into question given his extended leave and the criticism of the Royal Commission.
