Commonwealth Bank defends report that cleared insurance arm of systemic problems

Commonwealth Bank defends report that cleared insurance arm of systemic problems

Commonwealth Bank defends report that cleared insurance arm of systemic problems

Updated 7 March 2017, 16:20 AEDT

Commonwealth Bank chief executive Ian Narev defends a decision not to interview customers as part of commissioned report that last week cleared its life insurance arm of "systemic" problems.

Commonwealth Bank chief executive Ian Narev has defended a decision not to interview customers as part of a report that last week cleared its life insurance arm of "systemic" problems.

Mr Narev was grilled by the House Economics Committee on why the report by advisory firm Deloitte failed to speak with customers of CommInsure whose claims were delayed or denied.

Federal Labor MP Matt Thistlethwaite rejected Mr Narev's claim that the Australian Prudential Regulation Authority (APRA) found the Deloitte report to be "robust and independent".

"But you didn't interview the people that were covered by the policies. That's obnoxious," Mr Thistlethwaite told Mr Narev.

Mr Narev rejected the criticism, and said the review was done "to very rigorous methodology" that reached what he described as "clear conclusions".

Mr Thistlethwaite likened not speaking to customers to an episode of the 1980s BBC political comedy "Yes Minister".

"This case reminds me of Jim Hacker as the Minister for Health visiting a hospital that has no patients," Mr Thistlethwaite said.

"It's ridiculous that you didn't interview any customers or victims. It beggars belief."

Mr Narev also told the committee that no CBA executive has been sacked as a result of the scandals in wealth management or life insurance.

But he defended the CBA's current head of wealth management, Annabel Spring, who he said was not in control when 96 per cent of the unethical behaviour occurred.

Mr Narev also pushed back at suggestions that bank executives found to have acted unlawfully or unethically should be publicly named and shamed.

"What I will say is that our executives are entitled to the same due process as anyone would have," Mr Narev said.

"I would consider it completely appropriate that in our public reporting each year on remuneration that we make it very clear where there have been consequences for individual executives."

Mr Narev rejected repeated suggestions that a Royal Commission would be appropriate and possibly easier given the range of separate inquiries underway already.

But Mr Narev warned a Royal Commission would send a potential damaging message to foreign investors about the stability of Australian banks.

"I think the message that the convening a Royal Commission would send to about policy makers over the last decade, regulators over the last decade would not be positive for the industry," Mr Narev said.

The committee will also hear this afternoon from ANZ chief executive Shayne Elliott, with Westpac boss Brian Hartzer scheduled for Wednesday.