ANZ stood to make $6 million if it repriced rural loans

ANZ would receive a $6 million "annual revenue opportunity" if it repriced many of its Landmark loans due to a 0.63 per cent margin between the two companies' variable rates, an internal document tendered in the hearing said.

But ANZ head of lending services Benjamin Steinberg said he did not know if that actually occurred.

"I have seen through some of the case studies that I have worked on that there were price increases ... But I don't know how that was dealt with across the portfolio," he said.

Facing a grilling in Brisbane on Monday, Mr Steinberg admitted ANZ "should have done a better job" in communicating changes that would occur as a result of the acquisition of Landmark.

"Had they been advised earlier, they may have made a decision to refinance their facilities from Landmark before the acquisition occurred," Mr Steinberg said.

Earlier, it was revealed ANZ Banking Group admitted several instances of misconduct, in relation to agricultural finance customers.

ANZ acknowledged in a "small number of cases" its conduct to former Landmark customers, whose loan book it bought in 2010, may have breached the Code of Banking Practice to act fairly and reasonably towards its customers.

Out of the 268 submissions related to agricultural finance received by the royal commission, 32 related to the ANZ acquisition of Landmark in 2010.

At that time, ANZ acquired 7124 loans worth $2.298 billion.

As a result of Landmark accounts being migrated onto ANZ's technology platform, some customers had interest rates incorrectly charged, limits were incorrectly loaded and some had difficulties opening their accounts.

Mr Steinberg said the issues were as a result of errors by bank staff, but he did not believe they were systemic.

A 2009 due diligence report by McGrathNichol showed $273 million - or 12 per cent - of Landmark loans presented a risk.

But Mr Steinberg said 45 per cent of the loans having a D, E or F credit rating in November 2008 and August 2009 was not necessarily concerning.

"I prefer it to be lower but it's just telling us that the security is not as strong as we would like it to be," he said.

Senior counsel assisting Rowena Orr QC said within six months of the deal, about 10 per cent of Landmark's staff had been lost, and there was a concern it would lose 20 per cent within 12 months, which led to a loss of "corporate memory".

The McGrathNicol report recommended more credit management staff, but Mr Steinberg said he believed ANZ had appropriate resources.

In 2015, Mr Steinberg was part of a task force that reviewed "high risk" Landmark files.

The royal commission was told other banks had also admitted issues.

Those included a customer at Rural Bank complaining her signature had been forged by her husband and improperly witnessed by an employee of the bank. Rural Bank told the customer to report the matter to police but the bank did not investigate the matter itself.

Rural Bank also erroneously charged fees on season overdraft and agri manager products, affecting 2164 customers, with an impact of $163,461, with all customers remediated.

NAB admitted failing to pay interest on customer accounts, and 85 events of misconduct concerning agricultural clients since 2013.

The Commonwealth Bank also admitted instances of agriculture finance-related misconduct, including failing to apply fee waivers and ongoing package benefits to eligible customers who had bought an agri advantage plus package.

CBA had reported the incident to ASIC, which completed a mediation program in 2015, which led to about 8400 customers being reimbursed about $7.6 million

Appearing as a witness earlier in the day, ASIC regional commissioner for Victoria Warren Day said there was "certainly" an argument for ASIC to have a greater role in the regulation of farming finance.

Chris Wheatcroft, from Rural Financial Counselling Service Western Australia, said there was a notion farmers put their "head in the sand" but he did not accept that.

"I think it is true that farmers often look to tough it out," he said.

"They know someone else who actually has been funded ... That sense of injustice about what's happening makes - it doesn't make them cry, it makes them want to tough it out ... in their minds more resilient and more likely to try to battle the bank."

Mr Wheatcroft said appointing a receiver never benefited a client and asked if the commission could look at why receivers were appointed.

"In terms of values, farmers will see that hard-earned money, farm, asset, disappear under a receiver like you've never seen," he told the commission, to applause from farmers in the room.

The issue of administrators and receivers is not being considered by the royal commission.

The royal commission is this week sitting in Brisbane during round four of hearings, with five examples of agricultural business lending expected to be aired.

Natural disaster insurance and Indigenous people in rural and remote communities to also be under the spotlight, with hearings to move to Darwin next week.