What to make of a cautious and responsible Melbourne financial institution like the ANZ bank publicly telling the federal treasurer to get nicked? It looks suspiciously like a call by the big end of Collins Street that Peter Costello will be irrelevant after November 24 – and probably is already.

After Costello’s extraordinary performance on Tuesday night, effectively telling the banks he would not allow them to lift mortgage rates in the wake of the subprime crisis, the issue had to be on the agenda for this morning’s ANZ profit announcement.

New CEO Mike Smith had both good and bad news to deliver on the mortgage book. The good was market share growth as the credit crunch damaged non-bank lenders – most obviously RAMS. And ANZ wanted to reassure the market about its own funding, saying it had reduced its short-term wholesale debt funding to 26% of net assets, compared with a ratio of about 30% among its peers.

But the bad news came when Smith stated the obvious, the reality that Costello has tried to deny:

It is also important to understand that the banks have been absorbing the increased costs of funding for the time being. That’s something that can’t go on forever of course. Rates are purely driven by market forces so we will have to wait and see.

That’s pretty much what the NAB’s John Stewart said at the start of the week and for which he was slapped down by Costello. Maybe “Red” Pete really will have to nationalise those pesky Victorian banks just to teach them a lesson about saying unhelpful things during an election campaign.

Would a canny Melbourne institution with a blue-blood board (chairman Liberal Party benefactor Charles Goode et al) publicly tell the federal treasurer to go jump if it thought said treasurer would be in a position to get square for such an embarrassment? Methinks not.

Goodnight John, goodnight Pete – if you’ve lost the Melbourne business establishment, you’ve lost.