However, we think these costs will be small and manageable, especially relative to Australian banks' annual gross revenue, profits, and the potential costs of a bank failure, despite the claims in the media to the contrary. Much of the public debate around the outsourcing policy has focussed on direct operational costs and thus the relatively small loss in productive efficiency that may occur.
However, there are other aspects to efficiency to consider also, including allocative and dynamic responses. For example, our outsourcing policy could lead to better capital allocation due to more local decision making capacity, as well as systems that are more flexible and responsive to local needs.