Westpac chief executive Brian Hartzer says his bank is putting customers first by backing open data and denies it did the opposite by suggesting they join its poorly performing superannuation fund.
The Australian Securities and Investments Commission has taken Westpac to federal court over allegations it breached the "best interest duty" laid out by future of financial advice reforms when it recommended customers consolidate superannuation accounts into a relatively poorly performing Westpac-related fund.
Mr Hartzer told the House of Representatives economics committee on Wednesday said a disclaimer had made it clear his bank was only providing "general advice" on switching super.
He said that's why it was difficult to go into much detail with customers about the BT Financial fund's performance.
"It's a balanced fund that's designed to deliver returns through cycles in different markets that, while it might appropriate for some, it might be inappropriate for others," Mr Hartzer told MPs.
"But in a general advice conversation, there's a limit to the extent to which you can take that into account."
If ASIC won the case against Westpac, Mr Hartzer said, it would be "effectively be close to impossible to provide general advice".
Labor frontbencher Matt Thistlethwaite asked the CEO if Westpac had merely switched customers to a super fund with higher fees.
"Potentially the returns may be better," Mr Hartzer replied, although he acknowledged his unhappiness at the BT fund's performance.
However, Mr Hartzer said he keen on the idea of opening up customer' data to rivals with the aim of stoking competition, but said he was wary about exposing them to the risk of financial fraud.
Mr Hartzer said players outside traditional banking such as fintechs and governments had a role to play in data sharing and encouraging competition.
"We're relatively agnostic about who leads the process: we are supportive of open data ... (but) our obligations to protect customer data to protect them from fraud and all that are very real," he said.
