Christian Democratic Party – Newcastle – Milton Caine – Banking

Press release
Banking
Welcome I am Milton Caine the Christian Democratic Party candidate for Newcastle. I have been concerned for some time how the banking sector is treated by the Government and I have plans a foot to change the way things happen to empower the battler.
The financial crisis was caused by the exposure of the banks to bad debt. The problem began in the USA where home loans were up to 120% of the value of property and so when a small down turn meant that some defaulted on their loans the banks had no room to move and so a meltdown began.
Our Government offered support for the banks so that confidence remained in the banking sector in Australia as the government admitted that some loan holders were in crises, no direct aid given and so some foreclosures occurred.
The Banks though given support did not reduce the fees and charges and the interest rates were increased at a higher rate than the Reserve Bank’s increase.
The commonwealth Bank is back into record profits that eclipse the profits before the economic crises and has stated that they will choose to move rates independently to the Reserve Bank.
The government has said that credit card limits will not be able to be extended without a customer requesting the increase; this does not go far enough.
The financial crises was caused by poor lending practices and there needs to be a review and therefore I propose that all financial advisors be licensed and that licence will make them accountable for their advice, that maximum borrowing exposure on housing not exceed 80% of the realisable value of the home. This will cause a downward pressure on housing prices and greater security for borrowers and lenders. Other lenders will also make sure affordability of a loan is their prime concern and penalties and loss of licence to work in the industry will be introduced.
Borrowers in difficulties in the first instance will be advised on how to restructure their financial commitments and if necessary some short term assistance may be offered by Centerlink or other non government agencies.
My concern is that we make sure housing finance is affordable and recovery from poor decisions is the first option and not the removal of housing.
Milton Caine Christian Democratic Party candidate for Newcastle
ph 0410027593