Four Corners - Happy Banking?

Ask most Australians about the impact of the GFC and they'll tell you it wasn't too bad. With prudent bank regulation and a Government guarantee on bank savings, Australia's economy was the envy of the world. But was it that simple? This week reporter Debbie Whitmont tells the story of one Australian bank's near death experience and the fall-out for its customers.
If you believe the advertising, when you borrow money from a bank you are dealing with people who say they understand you and your business; someone who's prepared to work with you in good times and in bad. For many in business though the reality is rather different.
Back in early 2008, the Australian economy was going well. With the property market booming many businesses took out loans from Bankwest, a small but aggressive lender based in Perth. Then came the GFC. With its parent company in Britain facing dire financial problems, Bankwest customers began withdrawing money from their savings accounts. The Reserve Bank was worried and the Commonwealth Bank saw an opportunity. Moving fast the Commonwealth took over Bankwest for the bargain basement price of $2.1 billion.
From everyone's point of view, including Australia's central bank, it looked like a good deal. But what happened next shocked customers. Aware that the GFC was driving down property values and slowing the economy, Bankwest's new management did an audit of loans. Valuations were re-assessed; businesses called to account and in some cases loans were terminated. The Commonwealth Bank says both it and its subsidiary acted properly at all times - but did the bank act too harshly? Could some of these businesses have been saved?
Four Corners talks to a developer, a couple who dreamed of owning a holiday motel as a retirement nest egg and a publican who ran the classic country pub. All thought they had a bank they could rely on - but all lost their businesses.

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45 mins
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