Kiwibank bosses unruffled by slump in support

By KEVIN TAYLOR

Kiwibank bosses are not rattled by a slump in support for the new bank which unveiled its name yesterday.

The bad news came when an Auckland University business school survey showed support had plummeted since last year.

Only 19 per cent of residential bank customers surveyed said they would consider doing business with Kiwibank, down from 40 per cent last year.

Kiwibank chairman and former Prime Minister Jim Bolger said in announcing the name that he was interested in the numbers still thinking of switching, despite strong attacks on the new bank.

"If only 50 per cent of those in the new survey who indicated they would consider switching actually moved ... then we will have a very successful bank."

Other survey results carried important challenges for Kiwibank, he said. Only 37 per cent thought existing bank services were worth the fees paid, and the small Taranaki-based TSB got 95 per cent customer satisfaction - way ahead of the five major banks.

"From those two points emerge the challenge for Kiwibank - to give better value for money and to achieve the same level of customer satisfaction," Mr Bolger said.

Public research and consultation showed people wanted straight-forward and convenient banking with a community feel.

"That is our objective with the layout and presentation of Kiwibank. Customers will find it easy to find out where to go and what to do."

Interim chief executive Sam Knowles said the survey results were consistent with the bank's own research. Last year's survey, which indicated very strong support, was an aberration. "We have been pleasantly surprised at the support right across the board. In fact, the strongest support is from middle-income New Zealanders."

NZ Post chairman Dr Ross Armstrong told the Herald last month that more than 40,000 people had filled in expression-of-interest forms.

Kiwibank's fees will, on average, be 20 to 30 per cent lower than existing banks. By June next year, more than 300 branches will be open at most existing Post Shops.

This will almost instantly give it the largest branch network of any bank in New Zealand, ahead of the next largest - WestpacTrust - with about 200 branches.

The bank will offer services including credit cards, mortgages, term deposits, and internet and telephone banking.

Mr Knowles said the vision was to take banking back to the community.

The prototype branch showed the concept NZ Post was aiming for - a one-stop shop for banking, postal and financial transactions.

He said a recent international survey found that despite the e-commerce revolution, more than 77 per cent of people wanted to do complicated transactions at their local branch.

The driver of the bank's concept, Alliance leader and Deputy Prime Minister Jim Anderton, said the 100,000 customers Kiwibank needed to sign up over the next three years represented 5 per cent of the banking market.

"There are those in the Opposition who say that New Zealanders are not good enough to run our own bank. The Kiwibank, which will be run by our most respected enterprise - NZ Post - will show they are wrong."

nzherald.co.nz/peoplesbank