Westpac turns around NZ customer satisfaction

The latest Roy Morgan customer satisfaction survey of the New Zealand banking market shows that Westpac has achieved a strong turnaround after committing to a big investment program in a market where it had been lagging badly.

The survey, released yesterday, shows that Westpac's overall customer satisfaction score had the biggest rise among the seven banks reported - up 6.7 percentage points to 70.7 per cent over the year to June.

Despite the big rise Westpac is still at the bottom of its peer group and lags the leaders by a wide margin.

TSB Bank has the highest customer satisfaction rating at 93.4 per cent, followed by Kiwibank with 81.5 per cent, National Bank with 79.2 per cent, ASB with 78 per cent, Bank of New Zealand with 75.3 and ANZ with 73.9.

With the exception of Kiwibank, all the banks in the survey increased their customer satisfaction ratings but the magnitude of Westpac's improvement was much higher than the others.

Westpac acknowledged earlier this year that it had let its New Zealand operation slip.

Former Westpac NZ CEO Ann Sherry said in April the bank had not made as big an investment in its branch network as some of its rivals and, as a result, it was operating in too many low-growth regions serving low-income customers.

The New Zealand operation's results at the half year were disappointing. Net interest margin fell 25 basis points to 2.46 per cent, compared to the five basis point fall in Westpac's overall margin.

The bank's share of consumer banking customers in New Zealand fell to 21 per cent from 24 per cent the previous year. It was ranked number five in customer satisfaction ratings.

New Zealand CEO Brad Cooper said investment was going into new branches and refinements to products that would offer simplified features and fee structures.

Cooper said the bank had increased retail customer numbers and improved home loan market share. Customer retention had improved.