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  • Writer's pictureDale Webster

Regulator's inconsistent approach to data law puts it on shaky ground

Updated: Jan 19, 2023

APRA has contradicted the Treasurer and what its own chairman told Parliament as it scrambles to avoid making the 'big four' banks obey the law.

ABOVE: APRA chairman Wayne Byres during Senate Estimates in April.

AUSTRALIA’S banking regulator is picking and choosing which banks it is allowing to get away with breaking the law by misreporting whether their sites offer cash service provided by a teller.

Errors in hundreds of minor and foreign bank sites included in the Australian Prudential Regulation Authority’s points of presence data for years, even decades, have been corrected over the past 17 months after being exposed by The Regional in May 2021.

Two National Australia Bank former branch sites in Geelong and Waurn Ponds that only offered customers the ability to withdraw or deposit cash using ATMs were also downgraded to a lesser service channel in this month’s annual data release after APRA chairman Wayne Byres confirmed in Senate Estimates in April that they did not meet the legislation definition of a bank branch.

The Treasurer Jim Chalmers reiterated that they did not meet the legal definition of a “branch” under the Financial Services (Collection of Data) Act 2001 in July.

Despite this, 14 NAB sites with identical tellerless service models to the Geelong and Waurn Ponds branches were left incorrectly classified in this year’s data, as were another 11 ANZ, Westpac and Commonwealth sites that operate in the same way.

Both APRA and Treasury were aware of these additional sites before the data was released on October 19.

When questioned about the inconsistency, APRA gave no explanation.

What it did say contradicts what both My Byres and Dr Chalmers have previously stated.

“In cases where branches were staffed and offered customers the ability to withdraw or deposit cash using ATMs, APRA considered that those facilities continued to meet its definition of a branch,” a spokesman said.

ATMs are listed as a separate service channel in APRA’s points of presence data.

The APRA spokesman said the legislated definition of a bank “branch” would be reviewed next year “in line with recommendation seven of the Regional Banking Taskforce”.

The Regional Banking Taskforce was a Coalition Government initiative announced in the run-up to the Federal election.

It was widely criticised for being stacked with mainly banking representatives and its final report was released on September 30 by the Albanese Government at 4.52pm on a Friday night before a long weekend.

APRA’s comment sheds light on the out-of-context recommendation seven, which could potentially be used to prevent further banks being stripped of the right to call their sites “branches” if they withdraw teller service and force customers to use ATMs to get cash.

A change to the definition of a bank branch however, would require the drafting of new legislation and reporting standard to replace the current one and until that happens, reporting standard 796 that requires branches to provide face-to-face cash service, including business banking, and classifies ATMS as a separate, distinct service channel is still enshrined in law.

APRA does not have the power to change the definition of a bank branch without going through parliament.

Below is the preceding statement and questions that were put to APRA this week in full, accompanied by APRA’s response, in full.

The errors in Bendigo and Adelaide Bank/Rural Bank points of presence data had already been corrected and historic data over several years altered when APRA chairman Wayne Byres was questioned about long-standing errors in the ADIPOP database by Senator Malcolm Roberts in April this year. The Rabobank errors were yet to be corrected.

Federal Government Hansard:

Senator ROBERTS: Thank you. The Quill awards for excellence in Victorian journalism at the Melbourne Press Club recently awarded journalist Dale Webster a regional Quill award for her investigation of the true extent of bank branch closures in Australia. The article awarded:

...busted layer upon layer of myths being perpetuated by the banking sector. It also blew the whistle on errors in official data that have been published by the government unchecked for decades.

So that's your database that they are talking about, Mr Byres, isn't it? How good is your database?

Mr Byres: I think the database is fine. The database is the facts that have been reported. I have no reason to think that there are problems with the underlying data.

Senator ROBERTS: We have just discussed that a branch is labelled as a branch even if it doesn't have face-to-face operation?

Mr Byres: Well, as I said before, our definition says a branch should have—and you had the definition there—cash and then there was other face-to-face. That is the definition. That should be the way in which that is—

Senator ROBERTS: The database is wrong.

Mr Byres: Well, I'm not sure it is, but we can go away and have another look at that issue for you.

QUESTION: Why didn’t Mr Byres tell Senator Roberts (and by extension parliament) that APRA was aware of the errors and had already corrected the largest cohort of them by that stage?

QUESTION: Why did APRA report in the 2022 ADIPOP publication that classification errors by Rabobank and another foreign bank had been corrected but made no admission the previous year that around double the number of errors involving Bendigo and Adelaide/Rural Bank had been revised in not only the 2021 data, but in historic data dating back to 2019 as well?

QUESTION: Is APRA going to properly inform the industry, general public and media that its points or presence statistics dating back to when the ADIPOP database was first set up two decades ago have been significantly over-reporting service levels in regional Australia?

QUESTION: How is APRA going to handle the correction of its statistics dating back to 2001?

QUESTION: APRA and the Treasurer’s office were both in possession of a list of other incorrectly classified bank sites owned by ANZ, NAB, the Commonwealth and Westpac before the publication of this year’s ADIPOP data. Why did APRA knowingly publish incorrect data?

QUESTION: Why did APRA only correct the two NAB sites that were raised by Senator Roberts in Senate Estimates and leave another 14 sites with exactly the same format that it was aware of in this year’s data?

QUESTION: Given the significance of the reporting errors by the Bendigo and Adelaide Bank/Rural Bank and Rabobank, I ask again, has APRA/will APRA proceed with any disciplinary action under The Financial Sector (Collection of Data) Act?

QUESTION: Is there anything APRA wishes to say in reply to the fact it has been significantly over-stating regional branch numbers for decades due to false reporting by banking institutions?


You may attribute the following statement to an APRA spokesperson.

APRA has no further comment.

“Although there are no legal or prudential requirements for Australian banks to own or operate branches or ATMs, APRA collects and publishes data each year on bank branches, ATMs and other customer service facilities as part of its financial sector data collection role. APRA’s reporting standard ARS 796.0 Points of Presence includes a definition of a bank branch, which is only used for data collection purposes and does not place any obligations on banks in regards to whether – or how – they operate branches.

In response to questions about the continued appropriateness of the definition, APRA made inquiries into the data reported by banks, credit unions and building societies for inclusion in the annual authorised deposit-taking institutions (ADI) points of presence statistics publication. This included consideration of different branch structures and their alignment to the reporting standard definition. As a result, the latest statistics contain a number of revisions, including the recategorisation of 168 branches as “other face-to-face”. In cases where branches were staffed and offered customers the ability to withdraw or deposit cash using ATMs, APRA considered that those facilities continued to meet its definition of a branch.

In line with recommendation seven of the Regional Banking Taskforce, APRA will commence a review of its points of presence collection, including the branch definition, when the points of presence collection is next subject to public consultation in early 2023.”

Reporting standard 796

Financial Sector (Collection of Data) (reporting standard)
Download PDF • 809KB

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