Banks’ performance highly rated

A public opinion survey has found a high level satisfaction among bank customers, the New Zealand Bankers’ Association said today. The survey also measured perceptions of the banking sector’s strength and acceptable profit levels.

Seventy-seven per cent of respondents were satisfied or very satisfied with their main bank, with only nine per cent dissatisfied or very dissatisfied.

“We’re pleased to see that more than three quarters of all bank customers are happy with their bank,” said New Zealand Bankers’ Association chief executive Kirk Hope.

“The results reflect how competitive our banks are. They work hard to attract and keep their customers by providing excellent service.”

The survey also found that 61 per cent of respondents agreed that the strength of New Zealand banks meant that New Zealand got through the global financial crisis with less damage than other countries.

The public perceptions line up with local and international analysis of our banks’ performance. The World Economic Forum’s Global Competitiveness Report 2013-2014 rated New Zealand banks the second most sound in the world after Canada. An International Monetary Fund report in March this year found New Zealand banks to be well capitalised, accessing more stable forms of funding, and experiencing low and declining bad loans. These findings were reflected in the Reserve Bank’s recent Financial Stability Report.

“We have a strong, stable and well-regulated banking sector which supports our economic growth,” Hope said.

The survey also posed a question about what level of bank profits was acceptable. Of those with an opinion, the median range cited as an acceptable return on equity was 15-19 per cent.

“That’s higher than our banks’ actual average return on equity, which was 14.21% in the 2013 financial year,” said Hope.