Comment: Westpac drops the ball on payday lenders
Late last year, one of ABC's 4 Corners' producers rang to seek my views on Westpac's responsibility as a funder of payday lenders.
This is an entirely legitimate line of business for the bank, I told them, and makes sense in the context of the bank's interests in lending widely across the economy and diversifying its risks.
A long and puzzled silence followed.
Perhaps this line of thinking made an impact on the resulting 4 Corners documentary Game of Loans broadcast in late March.
A slap at Westpac featured late in this film. The show's producers made little effort to labour the point that it was up to banks to act as social engineers in a field already the subject of informed scrutiny by regulators.
So it's perplexing that Westpac, more than four months later, feels compelled to make a rather token gesture by dropping all payday lenders as counterparties.
The bank is only flagging that it is a soft touch for activists and its strategic resolve is weak.
Moreover, Westpac's treatment of its customers may be hard to reconcile with its track record, at least in the case of Money3, which claims to be a responsible lender, although it has had its problems.
And while payday lending, if done within very clearly defined rules is perfectly legal, it's the reputation risk from cowboy firms like those featured on 4 Corners that are proving too hot for the "Red Bank" to handle.
Westpac was also the last of Australia's Big Four to cut its support to the offshore remittance sector, late last year, citing reputation risk and the difficulty in meeting its obligations under the Anti-Money Laundering and Counter Terrorism Funding rules.
Once again, the pullback occurred after a handful of small rogue firms were pinged by Austrac for breaching AML/CTF rules, stranding the many legitimate businesses that were allowing migrants to send small payments "home" more often.
Perhaps Westpac could do more than just shut the door on all these companies that do, after all, have a place in the market.
If the bank is serious about taking an ethical position it could commit some dollars to a microfinance program like NAB's funding of Good Shepherd.