Business Customer Satisfaction With Banks Hits A Plateau

This story features WESTPAC BANKING CORPORATION, and other companies. For more info SHARE ANALYSIS: WBC

By Chris Shaw

Australian businesses continue to show solid levels of satisfaction about their relationship with their major financial institution according to the latest survey by TNS Communications Australia, but as the group points out the latest survey has revealed some interesting developments in recent months.

For the 12 months to the end of January the survey shows 79.4% of business banking customers are satisfied with their relationship, up 3.4% from a year ago, but this increase is tempered by the fact satisfaction levels appear to have plateaued in recent months.

This can be seen more clearly by looking at six monthly figures, TNS pointing out while on such a basis 76.9% of business banking customers are happy with their relationship, the level of satisfation among clients of the big four banks has actually declined by a combined 5.2% to 74.8%.

The shift is also impacting on individual bank ratings as for example while the January survey shows Westpac’s ((WBC)) business customer satisfaction ratings rose 3.4% to 78.3% for the past year, over the past six months it has actually declined by 6.4% to 75%. The news is not all bad for Westpac though as the survey shows recently acquired St George Bank has the highest level of satisfaction over both the last six and the last 12 months.

Commonwealth Bank ((CBA)) enjoyed the largest increase among the major banks as its customer satisfaction rating increased by 8.6% to 75.8% over the past year, meaning it has now caught up to its major banking peers in this measure. In contrast, National Australia Bank ((NAB)) reported the smallest annual increase of the big four, while ANZ Bank ((ANZ)) continues to enjoy the highest level of satisfaction among the majors at 81.6%.

Among the regional banks, over the past 12 months the survey shows Bank of Queensland ((BOQ)) has enjoyed a 3.6% increase in customer satisfaction levels to 92.5% while Bendigo Bank ((BEN)) appears to have some work to do in integrating its recent merger with Adelaide Bank given its customer satisfaction rating fell by 3.8% to 90.6% in the past year.

Suncorp-Metway ((SUN)) continues to lag its regional banking peers with a satisfaction rating of 82.6% for the year to January, while if CBA can lift the performance of the recently acquired BankWest from its rating of 73.6% for the year it appears to have some upside beyond what it has recently achieved in its core operations.

The TNS survey includes responses from 2,000 agricultural business and 10,000 non-agricultural businesses with annual turnover up to $300 million.

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