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Letter to Editors of the Daily Telegraph, Adelaide Advetiser and Hobart Mercury responding to misleading article published

16 February 2006

The Bank today forwarded the following letter to Editors of the Daily Telegraph, Adelaide Advetiser and Hobart Mercury responding to misleading article published:

Dear Sir

I refer to the article published in this morning’s edition under the headline "Which bank’s rates cost an extra $36" and would like to express disappointment at the misleading and selective method used to generate a sensationalist story.

The article wrongly asserts that each Bank customer paid an extra $36 in interest over the second half of the year. The error is compounded by the fact that the journalist chose only to look at interest income from borrowers and ignored interest paid to depositors. If he had taken the increased interest paid by the Bank to customers over the same period, he should have reported that each customer received an extra $40, resulting in a net gain to the customer of $4.

This was also confirmed by the fact that the Bank’s Net Interest Margin reduced during the period by 0.03 percent.

The journalist deliberately applied a misleading approach despite the Bank pointing out to him that it was not appropriate to select a single figure in isolation and that if he was to highlight the change in interest earned by the Bank, he should also, among other things, highlight the change in interest paid by the Bank to its customers.

In regard to other comparisons quoted, it was also pointed out to him the danger of selective reporting due to the fact that comparisons on past figures were not possible because of the need to reclassify many items as a result of the change in accounting standards.

Representatives of the Bank remain happy to discuss details of the Bank’s profit announcements to journalists seeking clarification of specific items.

Yours sincerely

Bryan Fitzgerald
General Manager, Media and Issues Management
Communication, Community and Reputation

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