australian banks are freeloaders

I note the huge rise in profit announced by the CBA on Friday. Much of this profit belongs to the Australian taxpayers and not to the CBA shareholders.

I am a staunch supporter of free enterprise and small government. I wish those who take risks with their capital well. This does not apply to the banks who took the taxpayers guarantee. They have nationalised risk and privatised reward.

I remember well the banks taking their guarantee then screwing many small businesses during the crisis. I think many viable businesses were destroyed over a short term liquidity issue while banks were carried by the taxpayer. The CBA was at the forefront of this.

If the big four banks are going to profit from an implied and demonstrated soverign guarantee they should pay for it. They are getting a free ride from the taxpayers.

If they are not going to pay for it then it should be explicitly and clearly removed. At the same time ( unfortunately) a Peoples Bank should be established owned and guaranteed by the Commonwealth and paying a lower rate of interest reflecting its AAA credit rating. It would be the only bank guaranteed by the taxpayers with the benefit of that guarantee also going to us.

Bacci