Reserve Bank of Australia governor Glenn Stevens' regular Parliamentary appearance on Friday confirmed he wants political players to worry less about high bank profits.Giving evidence to the House of Representatives Economics Commitee, Stevens said people with mortgages were not paying "seriously higher rates" because of banks' recent rate decisions. This was partly because the RBA took into account likely changes in bank interest rates - such as the recent increases in mortgage rates - in making its cash rate changes.Stevens also argued that bank profits were in line with those of other large Australian companies, and that competition between banks was good only to a point.Stevens' comments showed a belief that criticism of bank profits has gone too far.Committee chair Craig Thomson showed Stevens a chart of the Commonwealth Bank's rising profits.Stevens reacted by suggesting that "if we prepared a chart like the one you did there in absolute dollar values for the profits of a whole bunch of large listed Australian corporates, they would look very like that chart."Stevens went on: "The rate of return on equity that the banks are earning is good ... if my choice is between banks with good profits and banks with no profits then I choose the former every time from an overall macroeconomic point of view."He added: "You do not stay in a sound position in any business if the price of your product does not cover your costs, including your costs of equity. I think there can be a reasonable discussion about whether so many basis points are strictly necessary and so on, sure. But over time I think the thing that maybe has not had much focus is that the overall bank margins that we see today are a little higher than they were a couple of years ago but, compared to 10 or 15 years ago, are much lower, particularly in the mortgage base."Stevens also cautioned against seeking too much competition in banking. "More competition is good to a point," he said. "But beyond a point more competition is not good, because the bankers can be led to do things that ultimately cause a lot of subsequent damage."Among Stevens' other comments:* The big four banks had helped stabilise the financial system during the global financial crisis by taking a greater slice of new lending - but their market share of new lending had been falling for the past six months.* It was "prudent" for banks to seek to fund more lending from deposits. The global financial crisis had shown wholesale funding to be "a more unstable and risky source of funding" than it had previously appeared. And with wholesale funders charging more and offering less eagerly, banks had little choice.* Official short-term interest rates were at "about the right level."* Historically the RBA, like other central banks, had tended to raise interest rates too late rather than too early.* The current boom in Australian commodity export prices was "a once or twice in 100 years event" which Stevens warned