Who really owns the Big Four banks? Photo: Credit Card Compare
Australia’s ‘Big Four’ are not merely big, they’re massive.
Their combined assets stood at $2.86 trillion in 2013 – or roughly twice the size of Australia’s national income. They also annually make up four of the five largest Australian companies by market capitalisation, together representing more than a quarter of the market, with control of 88% of residential mortgages and 80% of deposits according to the IMF.
However, it’s not just banking they control: the Big Four also own 53% of life insurance premiums, and account for 57.3% of retail investment funds through bank-owned platforms, undeniably proving just how much power and influence these organisations have.
Despite this, through continued media programming and educational indoctrination, it seems nobody begs to ask the question: if they own so much of Australia’s economy, who owns the Big Four? In the following feature, Ethan Nash examines.
CONNECTIONS
According to a 2012 report by the International Monetary Fund, ‘major banks are highly interconnected, as they are among each other’s largest counterparties.’
But that connection is far from direct. Part of it has to do with banks borrowing from each other, rather than owning large parts of each other.
Related: Australian banks financing companies accused of land grabs, child labour
A study of the Australian bank network by the Reserve Bank of Australia found that more than half of outstanding authorised deposit-taking institutions ‘exposure’, in this sense, is to the Big Four.
Because they have so much of the money of the entire system already, when they need to temporarily borrow, there’s few other banks they can go to, so they have to go to each other. That’s a very cozy relationship.
CUSTODIANS
In 2013, General Maddox from Real News Australia launched a piece on the issue of bank ownership in Australia, specifically addressing the component of custodian ownership gathered from public information.
To this notion, it was discovered that the same four names could be seen as the top four shareholders in each of the four banks, but surprisingly, it’s not each other.
According to the Big Four’s annual reports for 2013, here’s who owns ordinary shares:
HSBC Custody Nominees (Australia) Limited: 16.91% of Westpac; 16.83% of NAB; 18.48% of ANZ; 14.80% of CBA
JP Morgan Nominees Australia Ltd: 12.75% of Westpac; 12.03% of NAB; 14.40% of ANZ; 11.57% of CBA
National Nominees Limited: 9.93% of Westpac, 10.14% of NAB; 11.76% of ANZ; 8.5% of CBA
Citicorp Nominees Pty Limited: 4.94% of Westpac; 4% of NAB; 4.15% of ANZ; 4.47% of CBA
‘Custodians’, by definition, hold customers’ securities for safekeeping, in addition to offering other services such as account administration and collection of dividends and interest payments, for a fee.
They are not active participants in decision-making. It would be wrong to imply that by having a 17% stake in Westpac, for example, HSBC also has 17% of the vote: as a custodian, HSBC only processes the proxy votes of the customers for whom it holds the shares – and these customers could be large sovereign wealth funds, or a board member of Westpac, or a family-owned business in Sydney.
Discrepancies in proxy voting do occur, and many uneducated investors aren’t even aware they can cast votes. But in principle, HSBC, in a custodian role, acts only as the messenger, not the decision-maker.
As a wholly owned subsidiary of HSBC Bank Australia Limited, the custody nominees business held more than $700 billion in assets. It is not only in the Big Four. The sheer size of its investment capital means that it frequently shows up among the top 5 shareholders for a large number of Australian companies.
In fact, HSBC, JP Morgan, National Nominees and Citicorp all frequently show up together among the top 5 or top 10 shareholders. They simply represent a very large pile of money, all of which has to be parked somewhere.
Realistically, often when consumers who choose to bank with smaller, more independent banks, they may – in fact – be banking with one of the ‘Big Four’. See a info-graphic demonstration here.
THE FACELESS?
On a different note, however, that 17% stake HSBC’s custodian arm has in Westpac could, in theory, represent just one person – or four big investors – buying through a variety of mutual funds, each of which has HSBC as their custodian.
For those who understand the long and complicated history of Europe and the establishment of the banking system by families like the Rothschilds, it is possible that this could be a very wealthy group of individuals or families behind the curtain.
Unfortunately, with how the system has been designed, it is practically impossible to track down the identities of those underlying shareholders through the various financial structures that hold shares for each other and on behalf of each other.
But can these hidden shareholders control what Westpac does?
The company points out that as of October 3, 2013, there were no shareholders who had a ‘substantial holding’, i.e., in which “they or their associates” have control of 5% more of the vote. NAB states the same.
Westpac explains that shareholders such as HSBC Custody Nominees (Australia) Limited (16.91% of total shares) ‘may hold shares for the benefit of third parties’ – the definition of their role as custodians. Furthermore, Westpac states it is ‘not directly or indirectly owned or controlled by any other corporation(s) or by any foreign government.’
But the top 20 registered shareholders held 52.42% of Westpac’s ordinary shares – and that’s a controlling stake. The word ‘nominee’ or ‘custodian’ pops up in 11 of them.
There’s an independent wealth management group, a closed-end fund, an investment management firm, and so on. Who is behind the actual shares would be, again, practically impossible to determine.
But the same names show up among the top 20 for each of the Big Four banks, with some variation.
The interconnection between the four banks may be even more pervasive, if even less direct. ANZ’s CEO, since 2007, has been Mr. M R P Smith – who has been with HSBC for most of his 30-year career prior to joining ANZ.
Since 1978, Mr Smith has held ‘a wide variety of roles in Commercial, Institutional and Investment Banking, Planning and Strategy, Operations and General Management’, according to ANZ’s annual report, including as director of HSBC Australia Limited from 2004-2007, immediately before he became CEO of ANZ.
In 2008, ANZ also hired its group managing director of human resources and chief risk officer from HSBC, and in 2011 plucked its new global natural resources head from HSBC.
Whoever it is that owns the Big Four banks, one thing is clear: if the same four custodian companies own similar chunks of each of the big four, there’s indication that the shareholders behind them do not want one bank to succeed at the expense of another.
The optimal scenario is if all of them win together, and maintain their dominant position, of course.
Thank you to creditcardcompare.com.au.
FOLLOW US
For more TOTT News, SUBSCRIBE to the website on the right hand panel for FREE and follow us on social media for more exclusive content:
Facebook — Facebook.com/TOTTNews
YouTube — YouTube.com/TOTTNews
Instagram — Instagram.com/TOTTNews
Twitter — Twitter.com/EthanTOTT
RELATED CONTENT
Collusion for Illusion: realnewsaustralia.com
Who Do You Really Bank With? [Infographic]: creditcardcompare.com.au
Australian banks financing companies accused of land grabs, child labour and more: tottnews.com
Australia: 2012 Article IV Consultation—Staff Report: imf.org
I mentioned this to my bank manager. He said the Big Four are known in the trade as The Killers. He took it very well, didn’t seem to mind at all. Bring into Australia another bank which has a good reputation – if such a breed exists!
Oh, very interesting and very revealing. HSBC = Formerly the Hong Kong and Shanghai Bank. Long associated with money laundering for the global opium trade. Think Golden Triangle.
CORRECT! I’ve mentioned this before to work colleagues, with the Usual ‘Tag’ – I am a ‘CONspiracy Theorist’!
That aside, ISN’T this called MONOPOLISING THE MARKETS? OR, at Least ‘PRICE FIXING’?
OR, is it Oligonomy – DEFINED = Oligarchs With MONEY! -YOUR Money!
COMMONWEALTH BANK, just ANOTHER U.S. Corporation – U.S. Securities & Exchange Commission.
CIK# 0000008565. In the Same Boat as THE COMMONWEALTH OF AUSTRALIA.
HSBC- Admitting, & were CAUGHT Laundering $Billions for Mexican & Columbian Drug Cartels. – ZERO Criminal charges/Gaol terms for THE Bank Execs, NO Confiscations for/ of Assets or Cancelled ‘Trading Licenses'(Profits of Crime – Sounds like Australia. -ONLY the ‘Underlings’ go to Gaol) – Thank You U.K. ‘Regulators’ for ‘Stepping in’ to ‘Protect Public CONfidence in THE Banking System’ – whatever that ‘Means’!
HSBC – ALSO has a Dubious History in Latin/ Sth America. see also HBUS ‘Operations’.
Wellness
BING! “Court Jester, You have Scored ‘Time Extension’!”
“And These Danced Underneath the Radar, – Underneath the Searchlights. Every Hup Hup!”
Along with ‘IT’S’ many inputs, HSBC, is also an INPUT ‘Sponsor of ‘The Atlantic Council’ (‘Created’ in 1961, HAS a ‘Tax I.D. & Tax Exemption #’ = LOL), – Another ‘Uncle Sam ‘Wholesome’ Home Made Apple Pie’ Govt/C.O.M.I.C. ‘Think Tank’, which ‘Partners’ with Groups such as ‘Facebook’, to ‘Battle Mis/Disinformation’ on things like Fake Social Media, improve Election security & fight Election propaganda- Home & Abroad..
On The Atlantic Council’s website, some of it’s Sponsors;
*HSBC Holdings – Thanks English, you seem to have your ‘Fingers in a Lot of Pies’! MORE than just a Bank.
*Rockefeller Brothers Fund – Also providing ‘HEAT’ officers locally on Globule Swindle ‘CONcerns’, or conCERNs!
*Adrienne Arsht; TAC’s Executive Vice Chair. Founder, Adrienne Arsht Latin America Center/ Adrienne Arsht – Rockefeller Foundation Resilience Center (Just ‘Coincidence’ – Really!) AND, Chairman Emerita, TotalBank
*Goldman-Sachs – Bank GangSTARS, amongst ‘Other’.
*Embassy of UAE. Sponsors of ‘Yemeni & local Genocides’, whilst Advocating ‘Human Rights’. – LOL.
*Crescent Petroleum- Find THEM on the WEF ‘Website’ – Ops in UAE & Kurdistan Regions of Iraq.
*J.T.& C.T. MacArthur Foundation
*Raytheon Technologies- Weapons & Weather ‘Manufacturing/Customising’. Thanks for the LRADs & ADS used @ OZ Rallies on Unarmed Citizens – ‘Silent Guardian’ – NEVER FORGET!
*Google Inc./Also provides SMC to Australia, – in League with YouTube, & Parent Co. Alphabet
*Foreign & Commonwealth Office of the United Kingdom- Who also Sponsor ‘Public’ Broadcaster CH4 U.K.-(Popular Coverages of Current Ukraine War/Diversionary ‘Something’)
*Lockheed Martin Corporation – Weapons & Enviro Geo Engineering – Sorry, Customising, Er ‘Contracting’.
*The Coca-Cola Company- That’s ‘Diversified refreshment’
*Chevron- More Than just ‘Fueling Things’, & Ripping OUR Gas & Oil – Now WHOLLY Own ‘Puma Energy’ (Australia). Yes folks, that’s Chevron Fuel Stations, STILL wearing ‘Puma’ Liveries!
*Bahaa Hariri (prominent Lebanese-Saudi billionaire – Horizon Group), on TAC’s International ‘Advisory Board’. and Assoc International Students House -Wash/D.C.- Don’t forget Your CONVID Jabs to ‘Attend’ Kids.
*United States Army – Gen. George Armstrong Custer Ethos- ‘Grab’ – Or ‘Wipe’ the Women & Children as Leverage on the Rest of Native Groups/Society @ Large, ADD a little Ego! STILL Operational Procedure. 7Th Cavalry – Swapped The ‘Nags, for Airborne Gun Ships with Gatling Gun Mags’!
*United States Dept of State. – SAY NO MORE!
*United States Chamber of Commerce- ‘Business’ is Where You Find – or ‘Create’ it!
*United States Marine Corps -Trust US! – ‘HUP!/ AUMP!’
*United States Navy – STILL ‘Phillie Experimenting’ with the ‘Fabric of ALL’!
With a ‘Group’ -TAC – that Gave their ‘Leaders award’ to Hillary Clinton,&, with Associated Skeksis Notables such as Henry KissStinger, I’m SURE that the Atlantic Council, IS, ‘Doing What’s ‘Best’ for us ALL’!
Amongst ‘TACs’ Many recent Highlights, Burisma Holdings (Blue Star Strategies) & Nord Stream 2.
And SO, The HSBC & Other Banking Groups By Association, are ALL in ‘Good Company’! = LOL!
Wellness
Thanks John. Really good work.
You’re all over it John, great work!