ANZ provided financial advice that was likely not in customers' best interests, the banking royal commission has heard.

Key points: ANZ audit found 1 in 20 pieces of financial advice not in clients' best interest

ANZ audit found 1 in 20 pieces of financial advice not in clients' best interest Audit found inappropriate advice went up but number of advisers dropped

Audit found inappropriate advice went up but number of advisers dropped Bank says more cases detected because of improved "control environment"

Chief risk officer of ANZ's digital and wealth arms, Kylie Rixon, was today questioned over a 2015 compliance audit into the bank's three main advice groups — ANZ Financial Planning, RI Advice and Millennium3.

Counsel assisting the inquiry, Rowena Orr QC, grilled Ms Rixon on the finding that 5 per cent of advice given was unsuitable.

"One in every 20 pieces of advice given to customers failed to meet the requirement that the advice was likely to be in the best interest of the client?" Ms Orr asked. "For the sample selected, yes that's correct," Ms Rixon said. Later, Ms Orr asked: "What's sampled in an audit is meant to be representative of what's happening across the business?" "Yes, that's true," Ms Rixon replied.

The audit, which looked at advice provided between June 2013 to June 2015, found 11 per cent of Millennium3 advisers and 6 per cent of ANZ Financial Planning advisers were rated at "high risk" of not providing appropriate advice.

Ms Rixon described the assessment as "very regrettable" and admitted there were deficiencies in ANZ's systems.

The audit also found the number of cases where inappropriate advice was given dramatically jumped, despite a drop in the number of advisers.

Ms Orr said 60 instances of inappropriate advice were identified in 2008.

By 2015, that number hit 2,810.

Today about 800 advisers work for ANZ and its authorised representatives — 500 fewer than in 2008.

Ms Rixon said the bank was detecting more cases of inappropriate advice because "the control environment" had improved.

She said she was not aware of a conscious decision to reduce the number of advisers, but some had been "performance managed out of the business".

She said ANZ performance managed 71 advisers over the past 12 months and about half of those had left.

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No system to reward quality advice

The commission was told ANZ updated its policies just this month to remove revenue measures from advisers "scorecards", which are used to determine their bonuses.

Ms Rixon said prior to the Future of Financial Advice reforms coming into effect in 2013, ANZ had placed a greater emphasis on whether advisers had grown their business rather than provided quality advice.

She told the hearing ANZ no longer published a "leader board" ranking advisers based on revenue.

But when asked whether she had considered ranking employees based on the quality of their advice, she admitted she had not.

"I could think of measures like net promoter score, which is a measure of customer satisfaction … there may well be others, I'm sorry, I just haven't turned my mind to that question before," Ms Rixon said.

The hearing continued this afternoon with an AMP executive in the witness stand.

Last week's hearings revealed AMP had misled corporate regulator ASIC and made multiple changes to an independent report into the "fees for no service" scandal.

The revelations led to the early exit of chief executive Craig Meller.