The rating of Australian banks by their business customers has declined sharply over the past five years, with one of the few exceptions being Bank of Queensland.
Research group East & Partners said today that BOQ had been the top-rated business bank in Australia continuously for the past five years.
HSBC, St George, and NAB came in behind BOQ in the latest survey.
BOQ’s score on East’s business banking index has gradually improved over the past five years, and is now at 63.9 points.
In contrast, the index for the industry as a whole (based on ratings of 10 banks) has declined consistently to just 30.5 points.
East’s banking index is based on interviews with about 800 businesses and is focused on four criteria in their ‘main’ banking relationships – empathy, satisfaction, loyalty and advocacy.
The largest falls have been among the big four banks, with Commonwealth Bank having the lowest index score of 16.6 points.
Commonwealth subsidiary Bankwest has gone from 39.9 to 29.2, while Westpac subsidiary St George’s index has fallen from more than 60 five years ago to 53.1 in the current round.
The five-year comparison shows that relations between ‘micro’ businesses and their banks have deteriorated in the period since the GFC.
In 2008, ‘micro’ businesses turning over between $1 million and $5 million gave their banks a collective score of 21.0, but this has now almost halved to 11.4.
East & Partners head of markets analysis Lachlan Colquhoun said the survey results were an illustration of how relationships between businesses – particularly smaller businesses – and their banks had deteriorated in the post-GFC period.
“Five years at the top of the BBI is an endorsement of the relationship model being pursued by BOQ, but shows there is a major gap between the big four and their customers,” he said.
“East’s analysis shows that the BBI is a strong predictor of market share, customer retention, wallet share, product cross-sell and bank margins.”
Brisbane-based BOQ is a niche player in the Western Australian market, following its acquisition of Home Building Society.
BOQ has 11 specialist business bankers based in WA, servicing customers across 29 branches.
A unique feature of BOQ’s approach is its owner-manager franchise model for its branches.
BOQ has recently launched a new branding strategy that challenges the industry norms with a tag line of ‘It’s possible to love a bank’.
“Customers experience our brand through our employees, our products and services, and they will decide whether they love us based on the service we provide and the relationships we build,” BOQ chief executive Stuart Grimshaw said at the launch of the new brand.
