Australian banks will now have to comply with a new code of practice, after recommendations from the Banking Royal Commission.

Tougher lending practices and penalties for those who do the wrong thing have been introduced.

Australian Banking Association CEO Anna Bligh says the news code has “real teeth” to force change.

Ms Bligh tells Steve Price it’s a step in the right direction.

“I think it would be a terrible outcome if we’d gone through all of that and the banks just said, ‘well, we’re going back to business as usual’.

“The public have high expectations in the wake of that investigation.

“Banks are absolutely determined to earn back the trust of every Australian.”

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