CBA postpones staff party after outcry

See previous post where CBA throw a party after jacking up interest rates? Now see below for latest developments. At least sanity prevails, thank goodness.

Here is the article:

CBA cancels staff party after rate hike outcry

16/06/2009 4:30:00 PM By Stuart Fagg, ninemsn Money

Commonwealth Bank of Australia has postponed a controversial $100,000 party for 800 staff after details of the event were reported by the media.

The bank was attacked by unions and customers over the party, which was being held just days after the bank raised interest rates on its variable mortgage, adding nearly $220 a year to repayments on a $300,000 homeloan.

The bank issued a statement this afternoon announcing that the party, which was to have had a 1920s gangster theme, had been postponed.

CBA spokesperson Bryan Fitzgerald said the bank acknowledged public concerns over the staging of the party in the current economic envrionment but remained committed to rewarding and recogising the contribuition of its staff.

Mr Fitzgerald added that reports that the party was to have featured Krug champagne and cavier were incorrect adding that the event was "to be of a modest scale with an Australian wine package and mini burgers".

The party had been organised for the bank's financial services dvision to celebrate the end of the financial year.

"The Bank would like to point out that the Financial Services event was a once a year function for staff of all levels in this division in lieu of a christmas party," Mr Fitzgerald said.

The bank angered homeowners and politicians late last week by announcing a 10 basis point rise in its variable mortgage interest rate.

The bank blamed higher funding costs on the move, but Prime Minister Kevin Rudd said the bank’s action threatened Australia's fragile economic recovery, while Treasurer Wayne Swan called the bank “selfish”.

Mr Swan warned yesterday of community outrage if another retail bank lifts its lending rates, adding that he did not believe the decision was justified.

"I believe that if any other bank were to take a similar decision, there would be understandable community outrage," he told reporters.

Reports this morning suggested that National Australia Bank and Westpac had raised rates on their fixed mortgage interest rates while ANZ bank raised rates on its fixed rate mortgages for 10 year loans two weeks ago.

Link: http://money.ninemsn.com.au/article.aspx?id=826208