1. The Code of Banking Practice (CBP) is an instrument of banking self-regulation. CBP was first published in November 1993. With the agreement of the Federal Treasurer, CBP became fully operative from 1 November 1996.
2. CBP is to be reviewed every three years in accordance with the Objectives and Principles set out in the Preamble to CBP and having regard to the views of interested parties.
3. The Objectives of CBP
   CBP is intended to

   (i) describe standards of good practice and service;
   (ii) promote disclosure of information relevant and useful to Customers;
   (iii) promote informed and effective relationships between Banks and Customers; and
   (iv) require Banks to have procedures for resolution of disputes between Banks and Customers.

4. The Principles of CBP
   The Objectives are to be achieved

   (i) having regard to the paramount requirement of Banks to act in accordance with prudential standards necessary to preserve the stability and integrity of the Australian banking system;
   (ii) consistently with the current law and so as to preserve certainty of contract between a Bank and its Customer; and
   (iii) so as to allow for flexibility in products and services and in competitive pricing.
   

5. The relevance and operation of CBP and its provisions will be reviewed in accordance with the Objectives and Principles stated above having regard to
   
   • the views of interested parties;
   • government policies;
   • changes which have occurred in the legal and regulatory environment (including self-regulation);
   • changes which have occurred in the banking services market and in the needs and behaviour of consumers as a whole;
   • consistency with relevant self-regulatory and regulatory measures; and
   • anticipated changes in the banking services market in the next three years.
6. The independent person appointed to oversee and direct the review is to report findings and recommendations to ABA as close as practicable to 31 August 2000. ABA will publish the report.

Views are invited on any of the matters covered by the Terms of Reference and should be submitted to Richard Viney by Friday 14 July 2000 at:

Code of Banking Practice Review
GPO Box 4612SS
Melbourne Victoria 3001
(This post office box has been replaced by a new address- please see "Contact Us")

Email: codereview@bigpond.com

Confidentiality

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