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Big report day for big issues.\xa0

Report Number One:\xa0The ComCom and the business of banking.\xa0\xa0

The market doesn\u2019t work, more banks would help, how to get more banks? How to get less regulation, how to get better deals for the customer?\xa0

Firstly, don\u2019t hold your breath. The ComCom has looked into power and petrol and banking \u2013 not a lot changes.\xa0

Nicola Willis didn\u2019t help yesterday morning when she said in response to a perfectly legitimate question about lending practices, that a\xa0bank CEO had said\xa0they \u201cweight farms differently from houses in terms of risk\u201d, Willis said well they can tell that to the select committee. Which\xa0as far as I could work out means nothing, given I'm sure they will.\xa0

Then when asked about the banking lobby being powerful, she said \u201cthey may be powerful but democracy is more powerful\u201d. Once again, it means nothing. What she was avoiding was the question \u2018will you legislate\u2019, and she was avoiding that because she is not legislating.\xa0

The same way the previous government made a lot of noise about supermarkets and petrol but were never going to legislate either. Instead, what we got was a sign on the footpath showing the 98 price and a Grocery Commissioner who so far is limited to press releases.\xa0

Here is your trouble: we have a lot of banks, we just don't use them. We can switch banks, we chose not to.\xa0

Yes, the rules the Reserve Bank has in place to make banks hold money could be changed, some of the regulation could be changed, but will it materially fix the market? No.\xa0

This, as I always say, is not to defend banks. Banks are highly profitable. Their margins are higher here than Australia.\xa0

But the mistake that is made almost every time, whether its banks, supermarkets, petrol stations, or telcos, is the hype never plays out in reality.\xa0

The jawboning gets the headlines, the action fades into obscurity.\xa0

Let's talk in a year, and you can show me how fundamentally different the New Zealand\xa0banking scene is. Or not.\xa0\xa0\xa0

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