Like hell it's a kiwi bank
The other night when I went out to get an ice-cream at a local dairy I was gobsmacked to be confronted with a wall of huge yellow advertising posters with heavy black lettering – “We’ve been a KIWI BANK since 1847” with the ASB logo at the bottom. What a brazen lie – like hell it’s a kiwi bank.
Back in the 1980s when it was a respected trustee bank, owned by its New Zealand account holders and serving their interests, it could legitimately make the claim. But in 1989 it was privatised and like our other big three banks – ANZ National, BNZ and Westpac – it’s owned by Australians.
And with the shift to private shareholder ownership the ASB’s first priority has changed to delivering dividends to its shareholders rather than service to its customers. No wonder the big four banks score so lowly in customer satisfaction surveys. The only thing keeping them going is the huge hassle and extra expense involved in changing banks. Without customer inertia these banks would be run out of town.
It’s no surprise to find yesterda'ys release of the multi-party Parliamentary Banking Inquiry’s report confirms the big banks did not pass on the full effect of reductions in the Official Cash Rate to New Zealanders in recent times. More billions into the banker’s coffers.
They have all been guilty of various customer and taxpayer rorts and have acted more like a cartel than competing businesses.
It’s not just the exorbitant fees and unjustified charges for all sorts of normal customer services but they have actively targeted their customers to go further into debt and have put a lot of pressure on bank employees to sell more debt to indebted customers.
They openly mocked Finance Minister Michael Cullen’s attempts to reduce lending for investment properties and will continue to undermine any government initiative which gets in the way of increasing their profits.
In most years these banks have taken $2 billion in profit across the ditch and we wonder why our current account deficit is so high.
And then there are the tax evasion cases where the High Court has found the banks guilty of screwing taxpayers through structured financial transactions which have been described as a sham to avoid tax.
The ASB owes us $280 million while the others (Westpac $961 million, ANZ National $562 million, BNZ $661 million) are even worse. It’s an appalling abuse - together these banks owe $500 in unpaid tax for every person living in New Zealand.
With such well-deserved bad publicity the banks are going on a charm offensive. As well as the ASB bank’s attempt to resurrect a nostalgic kiwi connection from its arrogant abuse of customers and taxpayers, the misnamed BNZ announced last week it was “Closed – for good” If only.
Most of the bank staff were out doing work in the community for a day to show what a good corporate citizen the bank is. The BNZ PR machine was working well because our local suburban newspaper (and I’m sure this was repeated throughout the country) had a story showing bank staff working hard clearing land for a garden for the families of cancer sufferers here in Auckland.
“Banks just genuinely believe that we need to be part of the community” said BNZ head of external communications Diana Maxwell.
She says the BNZ accepts there has been a loss of customer trust in the big banks “and we need to work hard to rebuild that trust”. They could start by paying back the $661 million they owe and apologising for their bad behaviour.
The latest charm offensive is just company spin. Former BNZ boss and now chief executive of BNZ parent bank, the National Australia Bank says the current hostility towards the major Australian banks is not tenable for viable businesses.
That’s the reason for the charm offensive – nothing to do with any genuine belief about needing to be part of the community.
Our economy has lots of parasites feeding on the wealth created by others. The ASB and its Aussie mates are the biggest bludgers.
I’m pleased these banks are having a harder time and I hope their spending of millions to buy kiwi goodwill is a failure.
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This is why I left one of the big four, years ago and went to a small NZ owned bank (not Kiwibank) and have never regretted it in terms of service and fairness of fees. I agree 100%.
The big banks' idea of a charm offensive is for the cashier to grimace at you in what passes for a smile and then ask how your day is going or some equally impertinent, fatuous and irrelevent question.
A quick look at http://www.interest.co.nz/ doesn't show the "real kiwi" banks being any better at passing on the cuts.
There are bound to be the requisite complaints about how banks are meant to make a profit etc. But, the issue is not that they should not make a profit but rather, the extent of that profit gained largely, at the expense of the customer and taxpayer. I rememeber years ago when I was a customer of the ANZ. I had been with them since I was 5, or rather the Post Office Savings Bank. I had never asked the bank for anything over the years, no overdrafts or loans. One week , I found myself short and asked the bank if I could have an overdraft of just $100. NO. The irony was, it was at the time when they had Clive James fronting their ads saying they were the bank that said YES! Well, I marched across the road to the PSIS where my father had an account and asked if I could have an account there. Absolutely they said, would you like anything else? Sure, a small overdraft? YES! So, I closed my account with ANZ and have been a very happy member of PSIS for fifteen years now. I think PSIS have shown how banking can benefit the customers and the banks (yes, yes I know they're a building society).
I agree with everything John, this lame attempt to try and gloss everything up with some slick PR/advertising is a scam and I'm sure most of us see right through it. Common NZ use you feet and walk out to an official 'NZ' owned bank.
Actually all the so called Australian banks are owned by shareholders in not only Australia and New Zealand but other countries as well. I guess this is too obvious for you to work out John being a champion of the left wing.
And actually the ASB does not score badly in customer satisfaction surveys.
"Our economy has lots of parasites feeding on the wealth created by others." - truest statement you ever made John; look at the cost of social welfare in NZ.
I wonder if John Minto has read any of the judgments in the "tax evasion" cases he refers to - if he had, he might know that his allegation that they involve tax evasion (a criminal offence) is not correct and the cases instead concern tax avoidance (not a criminal offence) and thus is potentially defamatory?
Couldn't agree more on the "Kiwi Bank" point though - this is a spectacular own goal on ASB's part.
I was quite surprised when I first saw the ad for ASB claiming to be a "kiwi bank". Surely it's obvious that this will attract a lot of disbelief and snarky comments? ASB seem to do well with their Goldstein ads, so why release an ad that's such a cheap shot?
As an ASB customer, I have never had any problems with them and have been really happy with their service and fees. I've been with all the others and Kiwibank and was unhappy with all of them (the worst was Westpac). As an advertising creative - the ad sucks. It's pretending like we're all a bunch of zombies with nothing between our ears. We're smarter than the average consumer! We know they're not a kiwi bank! Stop treating people like halfwits and maybe they'd get somewhere!
That pre-determined, politicised enquiry came out on the same day as an actual enquiry by the reserve bank that found the exact opposite (that banks have been struggling with expensive wholesale funding).
It’s a market, get over it. I'm with ASB because the way I have my accounts structured I pay no fees (and I'm not a student). I'd call that satisfaction.
Trust John Minto to grab that sudoenquiry's result with both hands when it serves his purposes. Shows the depth of analysis you get on this blog.
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A little precision please, Paul
One of the worst consequences of this is that Kiwibank now feels it has to compete with them on their level. Misleading advertising, creeping fees and hidden exchange rate costs must be the only way they feel they can keep up. Thin ice, Sam (Knowles).