SYDNEY • The Commonwealth Bank of Australia (CBA) money-laundering scandal has damaged the public’s perception of the whole banking sector, according to the head of the industry’s lobby group.

“The issue that Australian banks are suffering with is community trust and public reputation,” Australian Bankers’ Association (ABA) CEO Anna Bligh (picture) said in an interview on Monday. “The events of the past week, 10 days, have not only been very serious and damaging for the reputation of the CBA but for the banking industry in Australia as a whole,” she said.

The nation’s biggest lender has been engulfed by claims it breached anti-money laundering laws more than 50,000 times. On Monday, it said CEO Ian Narev will leave the bank within 10 months.

Australian banks, battered by a series of scandals, have been attempting to head off Opposition party calls for a wide-ranging inquiry into the sector, and fight back against the government’s decision to hit them with a A$6.2 billion (RM21.07 billion) levy.

“Australians do see the banking sector as an industry, and when something happens in one bank, it inevitably has some roll-on effect,” Bligh said.

Her stance was echoed by Australia & New Zealand Banking Group Ltd (ANZ) CEO Shayne Elliott.

“This is not something we can fix overnight,” Elliott said in an internal interview posted on ANZ’s website. While the industry is united in wanting to put the scandals behind it and is acting to address issues such as pay structures, “it’s going to take a number of years actually, that’s how trust is re-earned,” he said.

Giving a timetable for Narev’s departure will provide “certainty for the business”, CBA chairman Catherine Livingstone said on Monday, while batting away questions as to the link between his retirement and the allegations facing the lender. The bank has said it will file a defence to the money-laundering claims and that a coding error — which has now been fixed — accounted for many of the breaches.

“We do have a sense at CBA that for some time now it has been profit at all cost,” Australian Shareholders’ Association CEO Judith Fox said yesterday in a Bloomberg TV interview. “They need to address the culture issues. There has been one scandal after another,” she said.

Adding to CBA’s woes, the securities regulator said on Monday the bank will refund about A$10 million to more than 65,000 customers for selling them unsuitable insurance on products such as credit cards and car loans. The bank also announced that an internal review of pension payments found it had underpaid 36,000 current and former employees by about A$16.7 million. — Bloomberg