Customers

Key Highlights

Goal two: increase market share amongst chosen target market

Target market - Overview

Customer activity

Indicator Target 2012/13 2011/12 2010/11
% of account holders with three or more products >3 products 79.64% 73.64% 72.84%
% of account holders retained over the last 12 months No target 99.61% 99.99% 99.36%
% of account holders retained over the last 12 months >$35,000 $42,479 $36,523 $33,000

Active existing customers and their communities

As at 30 June 2013, there were 125,404 customers, down from 129,502 customers the previous year due to a continuing program to close dormant and inactive accounts. All operations occur within Australia, including the Bank’s National Call Centre.

Community sector

bankmecu is developing new business with community and relevant government organisations including those involved in the areas of science, education, environment and community services. The total value of community sector banking (deposits and loans) as at 30 June 2013 was $466,704,880, an increase of 5% from the previous year. Customers from the community sector now represent 16 of our 20 largest investors.

Responsible consumers

Responsible consumers take an active interest in ethical, social and environmental issues and consider the reputation of the brands in their purchasing decisions along with the impact of their purchase. The bankmecu brand is designed to appeal to this type of consumer.

The top five issues for customers in the 2013 Customer Insights survey included:

  • Being open, honest and transparent 88%
  • Responsibly investing customer money 85%
  • Not offshoring the outsourcing of customer services or back office administration functions 76%
  • Delivering the highest personal service 75%
  • Price competitiveness 70%.

While social issues rated lower compared to issues concerning how the Bank operates, 71% of customers noted in a separate question that renewable energy and welfare of vulnerable people in the community were most important to them.

Watch our video: bankmecu helps customers goGreen

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Target market - In depth

Active existing customers and their communities

The Bank’s history is reflected in its strength, resilience and the diverse range of communities that it serves. Its loyal long-term active participating customers and their communities represent a major strength of the Bank. bankmecu will develop business amongst this segment.

Operating locations

As at 30 June 2013, bankmecu had service centres and/or offices in the following locations, all of which form part of operations and are included as part of this report (unless otherwise stated).

Melbourne Region (VIC)

  • Eastland (Service Centre)
  • Glen Waverley (Service Centre)
  • Kew (Service Centre and Head Office)
  • Melbourne CBD (Service Centre)
  • Watergardens (Service Centre)

Gippsland Region (VIC)

  • Moe (Service Centre, National Call Centre and Online Service)
  • Morwell (Service Centre and National Lending Centre)
  • Traralgon (Service Centre)

Western Victoria Region (VIC)

  • Ballarat (Service Centre)
  • Bendigo (Service Centre and Administration Office)
  • Castlemaine (Service Centre)
  • Echuca (Service Centre)
  • Kyneton (Service Centre)
  • Maryborough (Service Centre)
  • Mildura (Service Centre)

Australian Capital Territory Region

  • Canberra (Service Centre)

New South Wales Region

  • North Ryde (Service Centre)

Queensland Region

  • Brisbane CBD (Service Centre)
  • Gold Coast (Griffith University) (Service Centre)
  • St Lucia (University of Queensland) (Service Centre)
  • Toowoomba (University of Southern Queensland) (Service Centre)
  • Townsville (James Cook University) (Service Centre)
  • West End – Brisbane (Administration Office)

South Australia Region

  • Adelaide CBD (Service Centre)

Customer profile

As at 30 June 2013 there were 125,404 customers of the Bank. This represents a reduction of 4098 customers over the year due to a dormant and inactive account program. The reduction in customer numbers provides an accurate average customer value amongst other customer metrics, and reduced administration costs. It also reflects accurately the number of customers who actively support the Bank with their business.

Geographic distribution of business

Deposits Jun-13 % of deposits Jun-12 % of deposits Jun-11 % of deposits
ACT 6.72 8.09 6.17
NSW 7.11 4.59 4.12
NT 0.21 0.08 0.09
QLD 8.09 8.53 8.65
SA 1.16 0.64 0.57
TAS 0.54 0.32 0.3
VIC 73.94 77.2 79.56
WA 1.09 0.55 0.54
Other 1.14 - -
Total customer deposits 100 100 100
Loans Jun-13 % of loans Jun-12 % of loans Jun-11 % of loans
ACT 7.12 6.68 6.53
NSW 11.01 8.5 8.66
NT 0.26 0.14 0.2
QLD 14.37 15.56 15.28
SA 1.37 1.14 0.81
TAS 0.44 0.26 0.29
VIC 63.73 67.03 67.41
WA 1.27 0.69 0.84
Other 0.43 - -
Total customer loans 100 100 100

The average age of bankmecu’s customers was 50 years (2011/12: 49, 2010/11: 47, 2009/10: 46). Consistent with the general Australian population, our average age of customers is increasing.

The significant demographic changes over the past year include:

  • all age groups increased their level of deposits, with corporate and community sector accounts achieving the highest growth of 23 per cent. The lowest growth was recorded by the 40– 55 age group, with 2 per cent growth while remaining the largest deposit group
  • corporate and community sector accounts  accounted for 28 per cent loan growth, while the 18–24 age group decreased by 12 per cent. The 56+ age group grew 7 per cent

Cash investments remain popular in the market due to an increasing culture of saving, the competitive rates on offer and sharemarket volatility.

Customer activity

Key performance indicators relating to the strength of customer relationships include product usage, customer retention rate and average customer value. The following table indicates bankmecu’s continuing strong performance.

Customer activity

Indicator Target Definition 2012/13 2011/12 2010/11 2009/10 2008/09 2007/08 2006/07 2005/06
Product usage >3 products % of account holders with three or more products through bankmecu 79.64 73.64 72.84 70.91 76.33 76.5 76.7 79.12
Customer retention rate* No target % of account holders retained over the last 12 months 99.61 99.99 99.36 99.34 99.27 99.47 97.8 98.5
Customer support value >$35,000

Total loans plus total deposits/

number of account holders

$42,479 $36,523 $33,000 $28,905 $26,259 $23,287 $18,915 $17,389

* Customer retention rate excludes dormant accounts and accounts closed for administration reasons (inactive, bad debt written off).

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Community sector

bankmecu is developing new business with community and relevant government organisations including those involved in the areas of science, education, environment and community services where these organisations share a purpose and set of values that are consistent with those of the Bank.

In addition, the Bank aims to develop business amongst people employed by these organisations.

Community sector banking

Many community sector and government organisations share much in common with us, including a sense of social and environmental purpose. bankmecu is committed to meeting the banking needs of these organisations.

Customers from the community sector now represent 16 of bankmecu’s 20 largest customers. We anticipate the value of this customer segment will continue to increase in coming years as the Bank seeks to meet the sector’s growing need for mission driven and competitive investments.

The total value of the Bank’s Community sector banking portfolio (deposits and loans) as at 30 June 2013 was $466,704,880. This is an increase of 4.8 per cent compared to the same time last year.

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Responsible consumers

Responsible consumers take an active interest in ethical, social and environmental issues and consider the reputation of the brands they support with their purchasing decisions along with the impact of their purchase. Our brand is designed to appeal to this type of consumer.

Customer attitudes

As a customer owned bank, customer attitudes help shape the approach bankmecu takes to responsible banking.

Customers were asked in the 2013 Customer Insights survey about issues of importance to them. The top 10 issues included:

  • being open, honest and transparent 88%
  • responsibly investing customer money 85%
  • not offshoring the outsourcing of customer services or back office admin functions 76%
  • delivering the highest personal service 75%
  • price competitiveness 70%
  • enhancing financial literacy for bank customers 42%
  • supporting communities where the bank conducts business 40%
  • championing the value and importance of cooperative enterprises 38%
  • tackling financial exclusion for marginalised people 31%
  • providing meaningful opportunities for customers to engage with the bank to discuss performance 27%

Our customers demand a bank they can trust to do the right thing, while maintaining service and offering competitive banking. While social issues rated lower compared to issues concerning how the Bank operates, 71 per cent of customers indicated in a separate question that renewable energy and welfare of vulnerable people in the community were most important to them. Quality of Education rose by five percentage points on the importance scale compared to 2012, indicating it is a subject that is of higher importance this year. A possible influence on this change could have been the high profile of the Gonski Report into education funding and bankmecu serving a large number of people employed in the education sector.

Customer responses to the question ‘What issues are important to you?’

    Positive response (%)
Question 2013 2012
Renewable energy 71% 70%
The welfare of vulnerable people in the community 67% 70%
Quality of education 66% 61%
Climate change 60% 58%
Housing affordability 57% 53%
Sustainable housing design 47% 45%
Loss of biodiversity 46% 44%
None of the above 5% 4%

Watch our video: bankmecu helps customers goGreen®

 

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