Westpac Banking Corp chief executive Brian Hartzer has defended vertical integration as the sector prepares for another inquiry.
The government has signalled it will fund its promised Productivity Commission inquiry into the financial services sector in Tuesday night's budget.
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One of the key elements of the inquiry will be an examination of vertical integration which sees banks selling products to customers that the banks themselves "manufacture" such as insurance or wealth products.
Critics have argued that this has produced a conflict of interest where customers are not sold the best product for their circumstance.
"I think the big picture here is that customers need more financial advice, they need more insurance," Mr Hartzer said, welcoming the review.
"We think the banks are well placed to provide this in a sustainable way that's free of conflicts of interest and that customers can get a lot of benefit out of that. So we're happy to look - to work through any sort of review that may be done."
Mr Hartzer said he felt the question of conflicts had already been dealt with in other reforms and the bank would argue that position "very strongly".
"When people get into this they realise the premise of the thing has been addressed by things like the best interest duty," he said.
"The issue is not about having conflicts of interest... it's all about how you manage those conflicts of interest."
Mr Hartzer said the bank spent about $300 million a year on compliance at the moment and he expected that figure to drop.
He also said focusing on the number of players in a market was not the best way to assess competition.
"Competition should be assessed on the deal that customers are getting, the quality of service that customers are getting, the range of innovation that customers are getting. I would argue very strongly on all three of those accounts Australian customers do very well," he said.
The Commonwealth Bank of Australia and National Australia Bank said they both supported the move.
A spokesman for ANZ said the bank believed the market was already highly competitive but supported the establishment of an inquiry.
"The enduring solution to concerns about the banking market is action to promote sustainable competition so that poor conduct is swiftly punished by loss of market share," said Customer Owned Banking Association chief executive Mark Degotardi.
"Consumers stand to gain from a more competitive banking market where all competitors have a fair go."