ANZ acquires a brand far more attractive than its own

By SIMON HENDERY, marketing writer

In branding terms, it is an acquisition one observer described as the ugly sister of banking taking over Cinderella.

ANZ has consistently rated at the bottom of customer satisfaction surveys, while its new prize, the National Bank, with its strong black horse icon, is a well-regarded and liked brand.

ANZ said yesterday both brands would be retained "for the foreseeable future" although there would be some changes - its rural business would run under the National name and other segments of the joint business "will use the appropriate brand name that advantages that business".

Asked about a total switch to the better regarded National brand, ANZ chief executive John McFarlane said the bank, which has about 1 million customers, suffered from skewed ratings in customer satisfaction surveys because of its higher than average percentage of "welfare clients".

Running both brands would allow customers to make the decision as to which bank they preferred, he said.

"We are keen not to dislocate the customer bases but thousands of people still want to bank with the ANZ.

"If they wanted to move they would have done so. We will let them decide which of the two to bank with."

But some commentators are predicting an eventual change to a single brand.

"Inevitably they'll have to make a decision - you just don't run those two brands," one said.

As one of the country's least favoured banking brands, ANZ faces particular issues given that it was acquiring the second most powerful brand.

Massey University senior banking lecturer David Tripe said Reserve Bank-imposed conditions on the purchase appeared to make it unlikely that the two brands could be merged into one.

Another commentator, however, compared the Reserve Bank conditions to Telecom's Kiwi Share agreement with the Government - apparently written in stone but susceptible to reinterpretation and crumbling over time as Governments changed.

Tripe said the ANZ had a hope that its brand could be restored in New Zealand "and that window has been left open".

"I suspect it would be a fairly demanding exercise to restore that brand. Whether it's cost effective to do so is another matter."

When the ANZ bought Postbank in the late 1980s it kept the brand running alongside its own for several years before dropping it.

"One would hope the ANZ have learnt some lesson from that experience and they won't create similar problems again," Tripe said.

One factor that would dissuade ANZ from putting all its marketing eggs in the National brand basket is that there is a seven-year limit on its use of the powerful black horse logo owned by seller Lloyds TSB.

But neither will the National brand be fading away. The joint banking business is to be run by Sir John Anderson, the current National Bank chief executive.

Asked about National's existing sponsorship arrangements, Sir John said the National Bank had a strong standing in the community through its sponsorship activities - including Daffodil Day, cricket and netball - and they would be maintained.


KEY DATES

April 14 - The National Bank refuses to comment on reports its British parent Lloyds TSB has put it up for sale.

June 17 - The bank finally confirms the industry's worst-kept secret - it is indeed for sale

Early July - Big Australian banks ANZ, Westpac and the Commonwealth Bank of Australia and London-based giant HSBC are rumoured to be interested.

August 8 - Waikato father and son Phil and Marty Verry announce they will put together a New Zealand bid for the bank but have difficulty being taken seriously.

August 13 - ANZ Bank publicly enters the race by seeking Commerce Commission approval to buy National Bank.

August 18 - Westpac follows suit with its application to the commission.

August 19 - Commonwealth Bank of Australia, owner of ASB Bank, says it will not make a bid.

August 29 - The Reserve Bank says it will use newly acquired powers to take a close look at the implications the sale of National Bank may have for the financial system.

September 4 - National Bank shows its value by reporting a six-month profit of $308 million, up 23 per cent.

September 12 - Westpac pulls out of the race and HSBC is rumoured to be losing interest. Talk of National Bank being floated on the stock exchange as an alternative to a sale gathers momentum.

September 25 - The Commerce Commission gives ANZ clearance to buy National Bank.

October 24 - The deal is announced.