By Gareth Vaughan
Preparing for a battle royal when rival ANZ culled its National Bank brand and reducing staff spending on the likes of entertainment and travel were among the factors behind Westpac NZ keeping its annual costs flat, thus helping to offset near flat income growth, CEO Peter Clare says.
Clare told interest.co.nz a "simplification for growth" strategy had delivered about $37 million of savings in Westpac's 2013 financial year, and more were to come during 2014 from a follow on "simplification for customers" programme.
"It was quite apparent to us at that stage (June 2012) that our revenues would come under pressure with the, at that stage, forthcoming merger of brands between National and ANZ. It was likely they would fight very hard to keep disaffected National customers," Clare said. "So what we looked at was if our revenues are going to be under pressure, typically from a margin perspective (annual net interest margins fell 10 basis points to 2.38%), where do you go looking? You make sure that you've got your costs well under control."
This is an abridged version of this article. The full version was published in our email for paid subscribers. See here for more details and to subscribe.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.