Media Release

29 August 2017: KAP Member for Kennedy Bob Katter has today stood by his pursuit of a Royal Commission into the banks, arguing that the Australian Prudential Regulation Authority (APRA) is a ‘lapdog’ and Australians will be left without the answers or transparency they are seeking, and that APRA is promising.

Mr Katter said that APRA’s track record in reviewing the banking industry shows their ignorance to the sickening toxic loans currently being offered by the big banks.

“Let’s just go through what APRA hasn’t done. APRA has not raised a finger to stop the toxic mortgages by the banks.

“A quarter of Australia’s entire population lives in the greater Sydney/Wollongong/Newcastle area where average housing prices are over $870k. An area where the average take-home-pay (after tax) is $56k. There is no way that with even two income earners these people can meet the required interest and repayments on $870k.

“These loans are toxic. And if they are to be driven by foreign investment, then arguably that is worse still. Foreign investors are preventing Australians from buying a house. In either case, where is APRA?”

Mr Katter referred to Henry Bournes Higgins, who was the first head of the Arbitration Commission in Australia, saying his famous quote perfectly describes the loan contracts offered by banks today:

“‘A contract made by one party, is by definition not a contract’. You sign up and you have no power whatsoever and they (the banks) have all the power, they can foreclose on you, raise interest rates, do what they like”.

Mr Katter accused the banks of setting Australians up for certain failure.

“Australia is out of step with the rest of the world because we have recourse lending. You can’t a make house repayment, the banks sell you up and the shortfall between the purchase price of a house and the fire sale price of the house stays as a debt with the borrower, once house owner.

“Who is the most culpable in a loan where the borrower can’t repay the loan? I’d say the bank is in the best position to know whether the young family can afford the house or whether they can’t.

“So therefore who should take most to blame? The bank of course. But the bank takes no blame at all, and the poor young couple, struggling with two or three kids, they now become a debt slave to the bank for forever”.

Mr Katter said that in sharp contrast, in countries like America, the homeowner loses his home and loses the money he put into the house, but the debt vanishes and resale of the house is carried by the bank as it should.

“The idea that a contract made by one person is particularly relevant in agriculture. Nearly half of our agriculture production is exported and is subjected to the wildest fluctuations in world market prices. Grains, beef and sugar all fluctuate by a 100% rise and then a similar fall until three years later, this will happen regularly.

“When the price goes down, land values go down, and the bank sells you up because the loan-to-equity ratio is shot to pieces even though the farmer has religiously met all his interest and repayments.

“The APRA has not and never will be a watchdog. It will be as it always has been; a lapdog and the carnage that has been wreaked upon the Australian people by the oligopolistic powers and greed of the banks.

“Almost all of their major CEOs are paying themselves around $12-$15m a year, and that is four times what the average Australian makes in his entire 40 year working lifetime”.

Mr Katter said the Royal Commission model works and is the most effective approach for revealing corruption and unethical practices and providing the public with full disclosure.

“I was one of the two people who pulled a Royal Commission into the police corruption in QLD and we succeeded at great cost to ourselves in weeding out corruption in the police force which had gotten completely out of hand at the time.

“But what a Royal Commission does, where the highly secretive APRA’s of this world act in obscurity and in a clandestine mode of operation, a Royal Commission operates in the glaring bright lights of the public gaze – the spotlight of the mass media and social media.

“And in the glare of the light of day, parasites will die upon exposure to sunlight and why are they scared of the people being able to see clearly what is going on. Why are they so scared?”

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