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Covid-19 driving financial services change: McEwan

The Australian Royal Commission of Inquiry into misconduct in the banking system highlighted that there were things going on in banking that were “just not right”, NAB chief executive Ross McEwan says.

Monday, August 17th 2020, 6:00AM 3 Comments

Ross McEwan

He spoke in a webinar for the CFA Society New Zealand last week.

McEwan talked about the importance of building the right team, creating the right strategy and making sure there was buy-in on that vision. He emphasised the importance of staff engagement in bringing out the best in the workforce.

McEwan was previously chief executive of AXA, First NZ Capital, and Royal Bank of Scotland.

He said the emphasis on conduct in banking in recent years had shown that the sector was not getting the basics right in many ways.

The Australian industry had become complacent after “20 or 30 years of good running” without a recession, he said, and had become complacent in banking as well.

“We needed a reminder of why we are here,” he said.

That was to be there for customers, he said, and sometimes that meant saying no.

“Sometimes the best answer for a customer is no … the industry had lost focus but that’s back now …You’re seeing that come through with the Covid-19 response from banks and regulators. What’s the best thing we can do to get through this? The bank wins when the customers win.”

He said Covid-19 had accelerated technological changes. Customers were happy to do many things for themselves if it was made simple for them, he said.

He said banks have a strong role to play using data and analytics, to help customers and make things available that are good for them. “If you do a good job [customers] will do more business with you. If you do a bad job and you get a bad reputation, then you won’t be in business for long.”

McEwan said the Australian and New Zealand Governments were in a good position to manage Covid-19 because of the good discipline and financial prudence of previous governments.

He said schemes that would keep people connected to their employers were good, and some industries would need further support – such as tourism.

McEwan said he expected the economy to be back to pre-Covid levels by 2022.

Tags: CFA conduct Ross McEwan

« AMP reports profit drop amid 'solid' resultAnalysts pick Covid-19 losers on NZX »

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Comments from our readers

On 17 August 2020 at 8:47 am 747 said:
Ref: BANKING BAD by Adele Ferguson..so have the financial executives of banking and financial services learned that their wealth CANNOT come from the expense of ordinary New Zealanders and Australians ? Or is it business as usual under cover of the covid-19 crisis?
On 18 August 2020 at 8:22 am Pragmatic said:
Whilst the acknowledgment within this article is 'refreshing' it seems that banking behaviours remain reluctant to change. The oligopoly of Australian banks continues to earn super-profits at the expense of the consumer who has limited options.

The locomotive of change for banks will surely be technology, enabling lenders to link directly with borrowers. I'm not sure where this is at, although once a technology solution has surpassed the 'trust barrier' set by banks (and let's be fair - this isn't a huge hurdle) then I'm struggling to think of a role for traditional banking.
On 19 August 2020 at 3:03 pm Rachelle Bland said:
Ironic then that after reading this article, a letter arrives in the mail addressed to my sister (who lives overseas, and who I am power of attorney for). It's from her Australian-owned bank (to be fair it's not NAB or BNZ) offering her 6,000 bonus hotpoints if she spends $150 between now and 31 August.

To quote their letter "So whether your card's buried in the back of your wallet, hiding in your drawers or lost under a pile of paper, it's time to dig it out and rediscover how rewarding it can be."

So in the midst of an economic downturn where thousands of jobs are on the line, and the bank knows that there hasn't been a single deposit made into my sister's bank account in 12 months, they offer her some of their money to spend and an incentive for doing so.

Who wins here? Banks really need to practice what they preach.

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