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Suncorp cuts branch network

18 May 2021 3:51AM

Suncorp Bank is the latest bank to announce an extensive overhaul of its branch network, with 30 closures since September last year and more of the 83 branches that remain in operation scheduled to close.

Like other banks, Suncorp is taking advantage of the rapid consumer and business take up of digital services to reduce its branch footprint and invest in enhanced digitisation.

Suncorp banking and wealth chief executive Clive van Horen told investors and analysts at a briefing yesterday that the closures would help with a planned reduction in operating expenses. The bank has committed to cutting its cost-to-income ratio from the current level of 56.5 per cent to 50 per cent by 2022/23.

He said the volume of transactions in branches had fallen by 60 per cent over the past five years. Meanwhile, the number of log-ins increased from 200,000 a week this time last year to more than one million a week now.

Van Horen would not say how many more branches would close. He said the bank had a plan but the number would be adjusted after assessing customer responses.

“We see an ongoing role for branches in areas like home lending,” he said.

The bank’s number one goal for its investment in improved services is in home lending – a market where it has lost about 50 basis points of market share over the past few years.

Van Horen said the bank’s home loan operation had been inconsistent over the years. Investment in that business was aimed at simplifying documents so the bank becomes easier to work with; cutting approval times; and adding resources so that the bank can cope with increased volumes.

The bank will offer rates in the “top quartile” but will not be a price leader.

He said there were promising signs, with a return to growth this year and no drop-off in turnaround times. Home loan lodgements were up 53 per cent in the March quarter, compared with the same period last year.

The formula for improvement – simplified products and greater digitisation – is the same in other priority areas: everyday banks, distribution and business banking.

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