He's asking for exemplary (punitive) damages - something that can be granted for egregious conduct as a way of scaring others from doing something similar. Since it's supposed to scare banks into compliance the amount is not that crazy.

I just had a look at it. Note that this is the first source i came across. It seems to be in line with the arguments of Williams

https://legalvision.com.au/4-things-to-know-about-exemplary-damages/

Exemplary damages are one type of damages available for recovery in civil disputes. Sometimes referred to as punitive damages, these types of damages are the most rarely awarded damages in Australia. This is because the court awards exemplary damages with the purpose of punishing a defendant, which contrasts with the Australian courts’ emphasis on using the legal system to provide compensation.

In general, damages are used to compensate a party for a loss and should aim to put them in the position they would have been in, had the wrongdoing not occurred. This means that usually, the court should not award a party more damages than their actual loss. In fact, the court must be cautious when assessing damages to ensure there is not an element of punishment (a punitive element) to them.

The court awards exemplary damages as a form of punishment. Further, their purpose is to deter the defendant and the broader public from malicious behaviour or conduct. Typically, this applies where that conduct causes harm, warning them that such conduct will attract punishment. Generally speaking, this behaviour will include certain elements, such as:

• malice;
• abuse of power;
• cruelty; or
• violence.

So it is possible that the court would follow the reasoning of Williams that the bank has abused its power in rushing to put the blame on him instead of investigating the fraud properly or taking measures to prevent the fraud. As bank customers seem to be regular victims of such fraud and the bank seems to generally just deny the claims instead of prevent the fraud, the argument of "abuse of power" and "malice" seems plausible to me. (Who is not a legal expert, leave alone in Australia)

If the court follows the reasoning of Williams that the bank needs to be handed a punitive damage sentence to discourage it from abusing its powers against its customers, i find his calculation appropriate. His pension seems in line with typical pension rates in Australia and the damage from the fraud also seems to be in the usual range. So punishing the bank with a comparable relative damage doe snot seem unfair. One could argue that his calculation is still quite generous as he is targeting the banks profits after tax, while his pension has to cover everything, and his "disposable" income from the pension is much lower.