Banks have improved both their culture of compliance and their ability to handle complaints, according to the Code Compliance Monitoring Committee.The CCMC, which monitors compliance with the Code of Banking Practice, released its 2012/13 annual report last week, detailing a big increase in the number of code breaches that were reported.To the uninitiated this might look like bad news, but the CCMC said it represented a more positive culture of compliance and a greater willingness to deal with complaints.The CCMC's chairperson, Brian Given, said: "The banks are continuing to improve their self-monitoring and reporting of code breaches and customer complaints."Signatories reported a total of 9403 breaches to the CCMC during the 15 months to June (the committee changed its reporting year) - an increase of 30.4 per cent over the previous year.There were 12 significant breaches reported, which was two more than during the previous year. Significant breaches are ones where a large number of customers are affected, the breach occurs frequently, customers are exposed to potential loss, or an event indicates inadequate compliance arrangements.Significant breaches included errors in disclosure, incorrect calculation of interest charges and fees, breaches of confidentiality, inadequate procedures for dealing with financial hardship, and problems with personal guarantee documentation.Signatories dealt with 898,000 customer complaints - an increase of 11 per cent over the previous year. And they dealt with 270,000 requests for assistance with financial difficulty - an increase of 5.3 per cent.The CCMC conducted two own-motion inquiries. It looked at how well banks were meeting their obligations for pre-contractual disclosure in relation to guarantees. And it identified a number of areas of good industry practice, such as conducting interviews with prospective guarantors to make sure they understood the commitments and risks of going guarantor.It also looked at how banks handled chargebacks. It found little improvement to practices in what has been a problem area and made some recommendations for better training of staff and better communication with customers.One interesting footnote to the report is that neither Macquarie Bank nor GE Money (which has a specialised banking licence) are signatories to the Code of Banking Practice. The two banks were amongst the worst offenders in the Financial Ombudsman Service's recent review of customer complaints.Also, no mutual banks have become signatories.