Customer-owned Institution of the Year

As customers’ needs change, their bank has to work hard to maintain an edge over its rivals

Greater Bank has pipped incumbent Bank Australia for the Customer-owned Institution of the Year title. A constant effort to “stay ahead of the game” and to meet the evolving needs and expectations of customers is one reason why it won this year’s award, says Greater Bank’s chief executive, Scott Morgan.

“The Covid-19 crisis has further galvanised this position as customers turn to us for support during times of financial hardship. We want them to know that we are here for them when they need us most.”

This last point is pertinent to Roy Morgan research that shows 90% of customers who bank with these institutions say they’re satisfied.

Low interest rates hurt savers but they also squeeze the margins at customer-owned banks, meaning they have to invest in their business to get an edge. This includes ensuring “we are providing competitively priced, quality products delivered in a way that reflects outstanding customer service”, says Morgan.

“Whether it be our customer-facing employees that work across our 57 branches across NSW and south-east Queensland or Newcastle-based contact centre, or those behind the scenes developing innovative products or services, each one plays a key role every day in delivering outstanding products and services.”

Greater Bank scored highly in the money minder category, which looked at term deposits over one, three and five years as well as the savings accounts attached to personal loans. The bank’s Our Best Term Deposit offers 1.25%pa interest for amounts between $5000 and $49,999 over a 13-month term (1.2%pa over 12 months). It bumps up to 1.3%pa over three years and 1.4%pa over five years.

The main point is flexibility. Customers have the option to invest by the month and terms start at one month and go up to five years. Interest can be paid monthly or six-monthly or when the term ends. There are no monthly fees and you can open an account with $1000.

Greater also scored highly in the business bank category, scored above the average in credit card offerings and is more than competitive in home and investment lending.

In second place, Bank Australia scored well across several categories including home and personal loans. At the time of writing, the bank’s basic home loan starts at 2.85%pa with a 70% loan-to-value ratio or lower. If you’re after a few more features (100% mortgage offset and several product discounts) you can get the premium home loan with a 2.63%pa interest rate.

Although Bank Australia has a smaller branch network than Greater Bank, the former dominates the customer-owned sector for making sure your money is invested sustainably. Your home loan won’t go into fossil fuels, for example.

Third this year and in 2019, Heritage Bank consistently offers its customers good value and service. It also scored highly in the money minder category, as well as for personal lending products and credit cards. Its variable standard personal loan has an interest rate of 11.99%pa and loan terms can be up to 10 years for a range of uses. Its fixed personal loan (up to five years) starts at 8.99%pa.