Big banks asked to front Senate inquiry

Australia's big five banks will be asked to appear at a parliamentary inquiry to face questions over the federal government's controversial bank levy.

The Senate economics legislation committee is set to hold a one-day hearing into the legislation in Canberra next Friday.

Representatives from the major banks, including Commonwealth, Westpac, ANZ, NAB and Macquarie, will be asked to appear.

The levy, announced in the federal budget and introduced to parliament in May, is expected to raise $6.2 billion, including $1.6 billion in the first year.

The Australian Bankers' Association wants a sunset clause added to the levy, arguing big lenders will face unlimited charges unless a time frame is introduced.

The legislation enshrines the levy rate of 0.015 per cent per quarter for banks with more than $100 billion in certain liabilities, meaning parliamentary approval would be required before it could be changed.