Westpac has continued its reign as the favoured business bank, but customer satisfaction across the banks continues to decline, according to the December data from DBM’s Business Financial Services Monitor.
Of the 7,756 Australian businesses surveyed, 88.7% are micro-sized with an annual turnover of less than $1 million.
DBM managing director Dhruba Gupta says the micro segment appears to have been the most sensitive segment in response to the interest rate movement in November, with three of the four banks experiencing decreases in satisfaction ratings in December.
“November’s interest rate changes may have influenced recent results and created downward pressure on the ratings, more so for Westpac, CBA and NAB than ANZ,” Gupta says.
The report reveals CBA, NAB and Westpac recorded small decreases in satisfaction from November to December.
“ANZ’s steady ratings from November means it has effectively increased its ranking and closed the gap with Westpac and CBA; these three banks are now equally rated in the eyes of their customers,” Gupta says.
“ANZ has joined Westpac in the leadership in the micro business segment, a position it has not occupied since August 2010. This is key to overall satisfaction results.”
In addition to being the last of the banks to raise interest rates in November, Gupta says Westpac is well received by the micro segment due to its relationship management platform.
“Westpac puts a fair bit of effort into appointing relationship managers, getting them out into the branches and giving them more authority,” he says.
“ANZ has initiatives along the same lines. All the banks do, but some do it better than others.”
Gupta says Westpac may need to maintain equal or sole first-ranked position in the micro segment if it is to retain overall number one position in coming months.
“Its lead over its competitors in the small segment has continued and, with CBA’s small decrease, the gap has widened.”
CBA was ranked first in satisfaction within the large business segment and also experienced an increase in satisfaction in the medium segment. However, its ratings declined for both the small and the micro markets.
CBA triggered a storm of public outrage when it lifted its standard variable mortgage rate by 45 basis points on Melbourne Cup Day, almost double the 25 basis-point increase in the cash rate.
Meanwhile, Gupta says NAB’s heavily-publicised “technical glitch” in November doesn’t appear to have affected its ratings across the board.
“NAB will continue to rank below the leaders overall if it maintains its position in the lower segments,” he says.
Although unable to predict when the next wave of rate rises will occur, Gupta says businesses should be prepared well in advance.
“If interest rates keep rising, and that may happen regardless of the floods, then businesses should be consolidating or paying off their loans, or switching to fixed loans,” he says.