The Banking Banana Skins 2014 report was carried out in January and February and received 656 responses from individuals in 59 countries.
It shows that, worldwide, banks regard growing regulation as the biggest risk to their businesses.
Although a small number of respondents said the growth of regulation was necessary, the large majority felt it had gone too far, was giving banks unnecessary costs and even driving financial business into unregulated parts of the sector.
PwC partner Sam Shuttleworth said regulation was seen as a burden by most banks in New Zealand.
“While it is clear regulation was needed, getting the right balance is important, especially once you overlay the cost of regulation.”
Where New Zealand and Australian banks differed from those in the rest of the world was in their view towards the risks associated with sales practices and social media.
Local banks ranked “sales and business practices” fifth on their list of potential risks, compared to a worldwide ranking of 16th.
Shuttleworth said banks were concerned about making sure that the way they were selling and marketing products was in line with what was required.
He said British banks had been stung for mis-selling interest rate swap products and the FMA and Commerce Commission were now looking into how interest rate swap products were sold to New Zealand farmers, too.
“While it is too early to say where these investigations will get to, there is a reputational hazard that the Australasian banks are navigating their way through, but also, bankers are acutely aware that customers continue to be their top priority,” he said.
They were also more worried about the risks to their reputation of social media, ranking it seventh compared to an international ranking of 19th.
“In the world we are in, customer experiences can be shared real-time through Facebook, Twitter and the like, with no real predictability on what will become a story or not. However, with the transtasman banks embracing the digital era of banking and delivering customer services, the ranking suggests that social media is more of a concern in our part of the world than elsewhere,” Shuttleworth said.
| « New FMA boss receptive to advisers | IFA working on pro-bono offering » |
Special Offers
No comments yet
Sign In to add your comment
© Copyright 1997-2024 Tarawera Publishing Ltd. All Rights Reserved