Sydney, 9 October, 2006: The Australian Bankers’ Association (ABA) says, in response to news reports today, that confidentiality of bank customer information is paramount and is treated with great care by financial institutions.

Bank-customer confidentiality goes to the core of a successful banking operation. Without a high level of trust, customers will not be willing to disclose information about their financial arrangements.

Individual banks will all differ to at least some degree in how they structure their backoffice and IT operations. Some banks will perform certain back office and IT functions overseas and, by definition, this means the overseas provider will have access to the data needed for that service. This is common practice across banking in every developed country in the world.

The commercial incentive to maintain confidentiality is supported by the Privacy Act and, uniquely to banks, the ‘duty of confidentiality’. This duty is confirmed in the Code of Banking Practice (CBP).

The ABA does not see any evidence of inadequacy (or ‘loopholes’) in this regulatory framework, but supports any reviews or enquiries to ensure the framework is working as intended. The Australian Law Reform Commission is currently conducting a public review of the Privacy Act and ABA encourages the Commission to consider the regulatory framework surrounding customer information. 

For further information:

Heather Wellard
Director, Public Relations
Phone: 02 8298 0411
Mobile: 0409 830 439

ENDS