ANZ’s ‘relentless’ pressure for new loans
ANZ ordered its small business team to “relentlessly acquire” new customers in a sales push that could result in major bonuses for staff, the banking royal commission has heard.
An internal ANZ document presented to the royal commission shows the banking major urged its small business teams to ramp up their efforts to “relentlessly acquire new-to-bank customers, attract larger cus- tomers and enhance their share of wallet with ANZ”.
The instructions were delivered in a document titled “key messages” contained within a small business bank- ing support package sent to branches in 2014.
In a separate document, a previously high-flying small business banker facing disciplinary action last year blamed mistakes on “a culture of sales pressure” and the “excitement of closing new deals”.
The commission scrutinised details of a $220,000 loan to a husband and wife launching an untested gelato franchise based on a business plan full of errors and wildly optimistic revenue and expense assumptions.
The Financial Ombudsman Service later ruled the loan should not have been made.
Former ANZ small business general manager Kate Gibson, who is now head of home lending, denied the bank’s sales culture had contributed to poor lending practices.
“I do believe that the culture of small business was one of wanting to perform but I don’t believe there was a culture of sales pressure,” Ms Gibson said.
Having previously defended making the loan to the gelato franchise, Ms Gibson yesterday conceded the bank had not been “prudent and diligent”.
Both ANZ and Westpac took issue with rulings by the Financial Ombudsman Service that had gone against them, warning the logic behind the decisions could stifle lending to small businesses.