01 Mar 2022
The time is right to remerge the bank’s Retail and Digital portfolios and build a separate Commercial offering, according to ANZ Chief Executive Shayne Elliott.
Speaking with bluenotes on video, Elliott says it’s important to understand the context for where the bank is now and why these changes are being made.
"ANZ Plus really is going to lay the foundations for the future ANZ and what we will be about for the next ten years and beyond.” – Shayne Elliott
“Four or five years ago, it was pretty apparent to us when we were thinking about the future and the changing shape of banking, particularly here in Australia and New Zealand for retail and commercial businesses, that the world looked very different,” Elliott explains.
“When we identified what customers were going to want in the future, what competition was going to demand of us, what regulators were going to demand of us, we realised the infrastructure and the way we were running the business really wasn't a contemporary way of doing that and we weren't going to get to where we needed to be.”
The decision was made to undertake a fundamental rebuild of the bank however the need to maintain servicing for current customers as well as a significant program of remediation work meant the digital transformation would benefit most from being split out and given some space to grow in scale.
“Now we're on the verge of launching our first big proposition into market under a new brand called ANZ Plus and so it's entirely appropriate that we re-merge our Retail offering,” he says. “It really is going to lay the foundations for the future ANZ and what [we] will be about for the next 10 years and beyond.”
Click here for a transcript of this interview
On the decision to split the Commercial banking business into its own entity, Elliott suggests he hasn’t focused enough attention on the business in recent years.
“It's a really valuable part of who and what ANZ is,” he explains. “It's time to move my attention, the Board's attention and management's attention, to how we nurture this business to be something really relevant and contemporary for the future.”
Elliott says the focus for the new Commercial division – which initially will report directly to him – will be building a sustainable, high-quality business which is differentiated in the marketplace long-term.
“Let's not forget [Commercial covers] everything from sole traders up to reasonably mid-sized corporates who are quite complex in their needs,” Elliott explains. “Whether they're in the healthcare industry, agriculture, manufacturing, tourism or whatever it might be.”
However, he said the outlook for the sector is good: “Applications for new credit across the small business spectrum are up almost 30 per cent versus a year ago so there's a lot of demand… It's a great sign for the economy and we're positioned to benefit from that.”
On the mid-term departure of veteran banker Mark Hand as part of the changes, Elliott is very clear issues around home loan processing were not a contributing factor in decision making.
“The decision about the future of the bank was really always planned. It was all about the timing,” he says.
“Mark's been a great, loyal member of the team for 30 years… he always puts the bank first. He was very much of the mind with us that the right thing to do was to split [Australia Retail & Commercial] as we had done in the past… In coming to that decision, we had lots of conversations about the future… and he decided that the best thing for him was to move on.”
Elliott said he had asked Hand to stay for four months to help him think through the Commercial bank strategy.
“Mark's got a deep experience in that space and his input and advice will be enormously valuable.”
You can listen to the whole conversation in the video above.
Andrew Cornell is Managing Editor of bluenotes
01 Mar 2022
01 Mar 2022