Banking Bad is one of those books you might buy for a father or brother for Christmas when you want to venture beyond socks and undies. That’s not to say it’s a bad book. In fact, it’s a pretty good read if you like a bit of corporate history and intrigue.
The book recounts the lead up to Australia’s Royal Commission into Misconduct in the Banking, Superannuation and Financial Services, a.k.a. the Banking Royal Commission or the Hayne Royal Commission. It then gives a summary of the outcomes from the inquiry, few of which reflect well on the banks and other financial institutions.
One reason to forgo the socks and undies, and perhaps even chocolate-coated sultanas, for the book is that it does a great job of describing some of the early events that starting the Hayne ball rolling back in the 1980s and 1990s. These included numerous Australian banks selling loans in foreign currencies, most notably Swiss francs, that ultimately turned into a financial nightmare for many unsuspecting Australian borrowers when their repayments soared when the exchange rates shifted.
The book also covers the shift in culture that occurred as the deregulation of the financial services sector saw the banks transform from being sleepy public service institutions into profit-making machines. This ultimately flowed through to the financial advice, money laundering and other scandals and misdemeanours your dad or brother might be more familiar with. All of these events certainly make you realise that you need to read the fine print if you’re interacting with the Australian financial sector and especially if you’re borrowing money.
But one reason to stick with usual presents, or perhaps another book, is that Banking Bad reads like a collection of the articles that author Adele Ferguson has written over the past two decades. There are many excellent passages and she has ensured the book flows as a complete, new work, but it doesn’t seem to add anything about the banks and other institutions that hasn’t already been reported. This means it’s a good read for anyone who didn’t follow the debate the first time around but will be less interesting to those who already know the story and want new facts or deeper analysis.
It’s also quite unbalanced and sensationalist. Like the original reports and the Royal Commission itself, it focuses on the industry’s worst and most sensational excesses (and they really are both bad and sensational). That made sense for selling daily papers, but it feels like the book could have offered a more rounded perspective and included more replies from the sector itself.
Banking Bad was published by ABC Books in 2019.
By Grant Butler