The Banking Code Compliance Committee (BCCC) has sanctioned Westpac Bank for serious and systemic breaches of the Banking Code of Practice (the Banking Code) after it failed to provide adequate support to customers following the closure of its branch in Tennant Creek, Northern Territory.
The BCCC's investigation revealed that Westpac did not comply with its obligations under the Banking Code and the Australian Banking Association's (ABA) Branch Closure Protocol when it closed its Tennant Creek branch in September 2022.
The findings show that Westpac needed to do much more to support customers to transition to other ways of banking, engage with the community to promptly address concerns, and provide adequate assistance to customers in remote areas to ensure they could still access essential banking services.
BCCC Chair, Ian Govey AM, commented, "The obligations set out in the Code are crucial for protecting customers when a bank branch closes. In this case, Westpac has fallen short of their promise to customers. Their actions have had a significant and detrimental impact on many people within the Tennant Creek community."
Many customers struggled to adapt to the closure, leading to an influx of requests for help to local community groups.
Additionally, Westpac's response to concerns raised by the community groups was deemed insufficient, creating further challenges, particularly for vulnerable customers, such as the elderly or those for whom English is not a first language.
Mr Govey added, "Westpac's failure to respond promptly to community concerns and provide adequate support was troubling and appears to have disproportionately impacted on vulnerable customers."
The BCCC's sanction to name Westpac is the most severe action it can take in response to serious and systemic breaches of the Code and raising awareness among the community. This decision is proportionate to the gravity of Westpac's failures and the need for banks to comply with the Code's requirements when closing branches, particularly in remote areas.
Mr Govey concluded, "This decision sends a clear message to the banking industry that non-compliance with the Code's standards will not be tolerated. Banks must carefully consider the needs of its customers and provide the right support to adapt to new ways of banking.”
A summary of the finding can be read on the BCCC website.
About us:
The BCCC’s purpose is to monitor compliance with the Banking Code of Practice and drive best practice.
To do this, the BCCC:
- examines banks’ practices
- identifies current and emerging industry wide problems
- recommends improvements to bank practices
- sanctions banks for serious compliance failures, and
- consults and keeps stakeholders and the public informed.
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