Westpac will halt regional branch closures during a Senate inquiry examining the exit of banks from rural towns amid mounting political pressure to show good faith to country customers.
A spokesman for Westpac said it would postpone the closure of eight banks in rural areas across the country, and there would be no decisions on the future of other branches during the inquiry.
The inquiry into why banks are increasingly shutting shop in regional towns was launched last week after the closure of almost 100 branches since September.
The committee will examine the reasons for banks’ departure and possible solutions, along with the effects on regional economies and community welfare.
Westpac had previously announced the closure of 20 regional and suburban branches, with eight in rural areas, including Denmark, Western Australia, Sale, Victoria, Cloncurry in Queensland and Kingston SE in South Australia.
The spokesman said the bank would continue its co-location program, which merges two group branches under one roof to “invest and stay in communities”.
Nationals senator and committee chairman Matt Canavan last week wrote to banks urging them to halt closures during the inquiry in an act of good faith.
Senator Canavan welcomed Westpac’s move but feared it was merely a “stay of execution”.
“The banks need to now work with the Senate on practical solutions to maintain people’s access to financial services,” he said in a statement.
“We can’t just leave country towns high and dry.”
The Commonwealth Bank said it would not shut any branches during the inquiry, which is due to report by December, and postponed planned closures in Junee, NSW, and Bright, Victoria
Victorian Nationals MP Darren Chester, who represents the community of Sale, ramped up pressure on the other banks on Wednesday.
“Enough is enough. Stop being so bloody-minded, stop being so bloody lazy and start working with regional communities on solutions that will allow face-to-face banking to continue in our communities,” he said.
But National Australia Bank said closures would continue during what it described as the single largest transformation in banking in Australia’s history.
NAB retail executive Krissie Jones said 93 per cent of transactions occurred online, and reshaping the branch network required difficult decisions, including closures.
A spokesman for ANZ said it was considering the inquiry’s terms of reference.
The inquiry follows the coalition government’s Regional Banking Taskforce, which found farmers, vulnerable people and small business owners struggle when a rural bank closes its doors.
It will hold its first hearing in Sale on March 2 and is open for submissions until March 31.
