17 October 2021
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Time to hate the banks?

Peter Switzer
27 August 2009

According to a passage in the bible, there’s a time to love and even a time to hate and lots of Aussies allocate their limited amount of hate for banks. And given what they can do, it can be understandable but the question is — is it time to hate banks?

I have to be honest with you, I made my reputation by giving selfish politicians and self-serving banks a serve or two in the media over a 25-year career. In fact, my favourite joke is a bank joke.

The bank manager is dead

A little old lady went to the bank and asked to speak to the bank manager. The teller said he was sorry but the bank manager had died over the weekend. The little old lady said she was sorry to hear the news and went away. The next day, she went back to the same teller and asked if she could speak to the bank manager. The guy thought: 'Poor old dear' and proceeded to tell her that the bank manager was dead. She said that this was terrible news and left. The next day, she returned to the same teller and asked to speak to the bank manager, but this time the guy’s customer service training deserted him and he fired back: “What are you playing at lady? This is the third time you have asked to speak with the bank manager and I've told you, and this will be for the third time, that the bank manager is dead! So, why do you keep coming in to ask the same question?”

And she replied: “I can’t help it young man, I just love hearing those words: 'The bank manager is dead!’”

Of course, this joke came from a time when deregulation of the financial system had not happened and bankers could be real bastards. I have personal stories, which to this day makes me hate the bank that employed such a rude, customer-killing bank manager.

Top 20

So now you know that I have the same programmed disdain for what banks can do, it makes it more meaningful when I say this is not the time to hate banks yet. The time is getting closer, but even if they raise interest rates before the Reserve Bank raises the cash rate of interest, there still could be a case for wise control of the hate emotions.

Part of my reasoning comes from a report this week on the world’s safest banks. It was published by Global Finance and is the 18th publication of The World’s Safest Banks.

For those who love number ones, Germany’s KfW took the prize as the safest on the planet. But as always in most competitions, with the exception possibly in cricket nowadays, we punched above our weight.

Our top four banks came in the top 20 safest banks. For the record, NAB took 11th place, CBA 12th, ANZ 15th and Westpac 16th.

For the competitive types, Germany also had four banks in the top 20 and they have beaten us in a photo-finish for the gold medal for safe banks. France gets the bronze with three in the top 20 and the Netherlands came in fourth with two banks in the elite group. In fact, Rabobank came in sixth, which they are happy to crow about locally — watch out for it.

Bank on it

At the core of why we have dodged the recession bullet and a severe economic downturn was the solidity of our banks. Throw in the 100 per cent guarantee of deposits, the Reserve Bank’s 4.25 per cent cut in interest rates, the stimulus packages and the rebound of growth in China, and it all explains why we have not seen our jobless rate head towards 10 per cent like the Yanks.

Of course, the banks will eventually deserve our hate but just as you wouldn’t quickly take away the measures that have helped us avoid recession, similarly we might have to show some tolerance of banks behaving badly until we are definitely out of the woods.

Borrowing costs overseas are still at elevated levels and as bank funding matures now and has to be rolled over, the banks are borrowing at higher rates of interest.


Until it’s safe to hate the banks again, take this tip — be a long-term investor in bank shares. They have potential capital gain and they pay good dividends. In a sense, one way to get even with a bank that might rip you off is to become a shareholder!

For advice you can trust, contact Switzer Financial Services.

Important information:This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.


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