Graeme Samuel, former chair of the ACCC, observed that the financial sector was one where "we layer protection upon protection upon protection" in a way not seen in almost any other industry in Australia.He contrasted this with the purchase of a house when, despite it usually being by far the largest investment any person makes in a lifetime, the seller is not obliged to point out defects. It's up to the purchaser, by and large, to find out.Samuel also challenged the popular perception that allowing the Westpac-St George and CBA-BankWest mergers at the height of the global financial crisis "had destroyed competition in the banking industry [in Australia] for decades to come."He asserted, rather, that competition in the banking industry post-GFC in Australia may not be aggressive, but it was tough. Interest-rate levels, though, tended not to move much month to month, and in any case there was no indication it affected the market share between the banks. The most noticeable impact was that margins were cut.Then there is consumer apathy, expecting the regulator to protect them. And Samuel said there appeared to be an expectation from both sides of Parliament that, not only has ASIC a responsibility to deal with miscreants after they've misbehaved, but the regulator will act to prevent investors losing money as a result of the actions of those miscreants.He also questioned whether a direction to the regulator to "promote more competition" is a workable instruction, saying it required an artificial interference in the market structure that more often than not would be expensive and not long-lasting.It was, instead, the very effective oversight by Apra and the Reserve Bank during the global financial crisis that proved to be the effective deterrent of any major disasters, Samuel asserted."Competition is the best regulator. It's the best discipline of all; it's the most flexible regulator," he said.If competition was acting very effectively, customers should be able to react negatively to poor provision of information just as much as they react to the actual information provided, as long as it's not false or misleading. Samuel said that legislating to protect the ignorant and apathetic had resulted in impediments to competition. He also took aim at the culture of prescriptive regulation, which he said had the effect of stifling competition, rather than encouraging it.Productivity commissioner Karen Chester noted that heading towards a "one size fits all" type of regulation was not appropriate for emerging innovators as they represented a new source.She also pointed to stress testing by one of the Big Four banks last year which showed that it would hold up under a scenario of a 30 per cent decline in house prices and 11 per cent unemployment over three years.  But she said what she found revealing was that the stress test "did not tell me enough about the bank's profitability nor intuitively the return on equity."Good news for a regulator, maybe, but not good news for a shareholder in terms of balance sheet and ultimately - and arguably