customer benefit dividend
bankmecu aims to deliver its customers a superior level of pricing when compared to Australia’s four major banks. Each year, bankmecu employs an independent Financial Services Research Group, Canstar Cannex, to determine how much customers save in total by choosing to bank with bankmecu. The Canstar Cannex figure is determined by comparing the pricing on bankmecu deposits, loans and transactions to that of the average pricing offered by the four major banks. The Canstar Cannex valuation equates to a pre-tax internal customer benefit returned to customers in the form of competitive interest rates and fees.
In 2010/11, Canstar Cannex determined the customer benefit to be $31.165m compared to last year’s $31.523m (2008/09: $24.047m), the difference of $358,000 resulting from a market where interest rate competition for deposits was fierce and fee discounting prominent in promotions by competitors.
Figure 5c : Customer benefit by product segment
|
Product
|
Annual Customer Value
|
Distribution:
customer value
|
|
Deposit Products
|
|
|
|
Rate based analysis
|
$12,931,819.60
|
41%
|
|
Transaction based analysis
|
$1,742,708.70
|
6%
|
|
Total deposit products
|
$14,674,528.30
|
47%
|
|
|
|
|
|
Lending Products
|
|
|
|
Rate based analysis
|
$12,087,368.17
|
39%
|
|
Lending fee analysis
|
$4,403,292.33
|
14%
|
|
Total lending products
|
$16,490,660.51
|
53%
|
|
|
|
|
|
Total annual value
|
$31,165,188.81
|
|
|
Total number of customers
|
134,565
|
|
|
Total Annual Value per customer
|
$231.60
|
|
The data indicates that each bankmecu customer is on average $231.60 per annum better off by banking with bankmecu than banking with the four major banks. This return is in addition to the contribution to customer wealth through the addition of a record profit to capital reserves.
The assessment of customer benefit shows that customer benefit is delivered in better interest rates on deposits; more competitive interest rates on loans; and lower lending and transaction fees. bankmecu ensures a fee-free banking option remains available for all customers. It rewards customers based on their level of business support. The Company’s transaction fee model is consistent with Reserve Bank of Australia (RBA) expectations of clear cost-related pricing of respective payment channels to facilitate cost-effective customer choice.