Bank ‘groomed us then smacked us to pieces’
A MAN who "lost everything'' after taking loans with the ANZ Bank has become emotional on the stand at the Banking Royal Commission, which has begun hearing personal stories from farmers caught up in financial strife.
Michael Hirst, whose family were in cattle, sheep and timber production in Tasmania but who has now left farming, received a personal apology from the ANZ this morning.
Mr Hirst's family borrowed several million dollars from Landmark in the early 2000s.
The ANZ took over Landmark's loans book in 2009 but ANZ executives treated the Hirst family well, he said.
Bank representatives took them to a restaurant and told them they were valued.
"They took us out to a decent restaurant near our town and basically pumped us up,'' Mr Hirst said.
"They said we were a very good business and they wanted to see more of us.''
By August 2011 the family were in difficulty and the ANZ's relationship manager came out to their property and told Mr Hirst: "Put the cheque book away.''
The ANZ told the family the bank's lending strategy was on a cash flow basis, not on capital sales which was what the previous arrangement had rested upon.
"And that really blew us away because right up until that point we had been supported to the hilt, and they had groomed us up to that point and then they just turned, and then we were just smacked to pieces,'' Mr Hirst said.
"I managed to get a job driving a truck and my wife was in bed,'' Mr Hirst said as he fought back tears.
"So it was tough.
"We couldn't find any resources to fund a legal team to challenge what the ANZ was doing.''
Mr Hirst said he accepted he had fallen into financial difficulty but then began to question if the bank had behaved improperly.
"As we went through the process of them picking our carcass to bits, a few stories started to emerge from the mainland about potential problems in this Landmark/ANZ takeover business, and we started to engage with a few people.''
Senior Counsel Assisting Rowena Orr, QC, asked Mr Hirst:
"Are you satisfied that the bank played a role in you losing everything?''
"Oh there is no doubt, there is no doubt,'' Mr Hirst said.
Benjamin Steinberg, of the Australian and New Zealand Banking Group Ltd, earlier admitted the ANK Bank had erred in its handing of the Hirst account and offered a personal apology.
Outside the court Mr Hirst praised the work of Ms Orr and the Commission in general and said he had some sympathy for Mr Steinberg, who has just finished nearly three days of intense cross examination.
Mr Hirst said it was not Mr Steinberg who had created the culture inside the ANZ Bank which led to his losing his livelihood.
The hearings continue.
ANZ pursued family after cancer diagnosis
THE ANZ Bank pursued negotiations with a Queensland farming family to resolve a debt issue despite the mother being diagnosed with cancer, the Banking Royal Commission has been told.
Benjamin Steinberg, of the Australian and New Zealand Banking Group Ltd, admitted the decision was not in keeping with community standards, and the bank would handle things differently today.
Senior Counsel Assisting Rowena Orr, QC, told the Royal Commission, now sitting in Brisbane, the Hanley family of Queensland had informed the bank of the cancer diagnosis and sought a delay on mediation hearings on loans.
"Instead of seeking further information about Mrs Hanley's illness ANZ declined to postpone the mediation?'' Ms Orr asked Mr Steinberg.
"That's right,'' Mr Steinberg replied.
"When in fact she had been diagnosed with cancer?'' Ms Orr asked.
"That's what we found out, that's right.''
If the situation arose today the matter would be treated differently, and assessments of what direction to take would be made on the bank's "new values,'' Mr Steinberg said.
"I would say we are consistently evolving, consistently trying to do better.''
Mr Steinberg has refused to concede the ANZ acted unethically when selling off properties, which the bank had foreclosed on, at a dramatically reduced price.
Queensland farmers have been highly critical of bank fire sales of property and equipment to re-coup loan money.
Mr Steinberg confirmed the ANZ sold off four parcels of land belonging to Western Australian farming family, the Harleys, at $780,000 which was around $400,000 less than an estimate of market value made only months before the sale.
"I agree the story is a sad one,'' Mr Steinberg said.
"But none-the-less what we were doing here was pursuing our contractual rights to get paid.''
Mr Steinberg said the ANZ had given the Harleys a number of years to get to the point of the land sale.
"I put it to you squarely that this a was a breach of ANZ's obligation under Clause 2.2 of the Code of Banking Practice to act fairly and reasonably towards the Harleys in a consistent and ethical manner,'' Ms Orr said.
"No, I don't agree with that,'' Mr Steinberg said.
"You don't agree with that?" he was asked.
"No.," Mr Steinberg replied.
The hearing continues.