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2004 Half Year Financial Results - Analyst Briefing Transcript - The National Australia Bank Group - NABGroup
2004 Half Year Financial Results - Analyst Briefing Transcript
2004 Half Year Financial Results - Analyst Briefing Transcript
This is an edited transcript of the analyst presentation by National Australia Bank Chief Executive, Mr John Stewart, and Chief Financial Officer, Mr Richard McKinnon, on 12 May 2004 for the 2004 Half Year Financial Results.
Richard McKinnon - Secondly, a fall in penalty fees as a result of increased charges and changed customer behaviour.
But if you look at the results you'll see that operating income has been slowing into it. That is not by accident. We've been doing that deliberately because we have put up some of our charges too far and we wanted to improve our customer proposition and make sure that we got that right because that related directly to customer satisfaction, and customer satisfaction relates directly to customer loyalty.
Now we haven't achieved this by good management, or by luck. We've achieved it by charging the customers more. We've achieved it by having high margins, and you can see where our margins are up there, again compared to the average. The same thing pretty well goes for costs. If you add that to a number of investments, you've got a situation where you do that for a few years, and it becomes unsustainable. What then happens is that you start to suffer from customer attrition and your growth falls.
If you could just talk a little bit about product pricing in the UK versus Australia. Just from your experience, particularly retail products, do you see products here being competitively priced in a global sense?
John Stewart:
I think probably the product pricing is keener in the UK, and I don't think that's surprising. I mean we have four majors here – we are certainly getting challenged by St George, but you've got a limited amount of banks. You've got a lot more top class banks in the UK, and you get banks that do sometimes take real pricing initiatives. The most recent one, which has gone on for some years now, has been HBOS. Obviously the quality's not bad either, that's why they have tended to try and be the price leader and the price setter.
But do I think that you can never extrapolate that and say our margin is going to go further down here? No not necessarily. But what is for sure, this is going to happen anywhere in the world, is that the customer is going to get a better and better deal, so you had better get a more efficient at doing what you do.
( so we can find the darn thing
)
2004 Half Year Financial Results - Analyst Briefing Transcript
2004 Half Year Financial Results - Analyst Briefing Transcript
This is an edited transcript of the analyst presentation by National Australia Bank Chief Executive, Mr John Stewart, and Chief Financial Officer, Mr Richard McKinnon, on 12 May 2004 for the 2004 Half Year Financial Results.
Richard McKinnon - Secondly, a fall in penalty fees as a result of increased charges and changed customer behaviour.
But if you look at the results you'll see that operating income has been slowing into it. That is not by accident. We've been doing that deliberately because we have put up some of our charges too far and we wanted to improve our customer proposition and make sure that we got that right because that related directly to customer satisfaction, and customer satisfaction relates directly to customer loyalty.
Now we haven't achieved this by good management, or by luck. We've achieved it by charging the customers more. We've achieved it by having high margins, and you can see where our margins are up there, again compared to the average. The same thing pretty well goes for costs. If you add that to a number of investments, you've got a situation where you do that for a few years, and it becomes unsustainable. What then happens is that you start to suffer from customer attrition and your growth falls.
If you could just talk a little bit about product pricing in the UK versus Australia. Just from your experience, particularly retail products, do you see products here being competitively priced in a global sense?
John Stewart:
I think probably the product pricing is keener in the UK, and I don't think that's surprising. I mean we have four majors here – we are certainly getting challenged by St George, but you've got a limited amount of banks. You've got a lot more top class banks in the UK, and you get banks that do sometimes take real pricing initiatives. The most recent one, which has gone on for some years now, has been HBOS. Obviously the quality's not bad either, that's why they have tended to try and be the price leader and the price setter.
But do I think that you can never extrapolate that and say our margin is going to go further down here? No not necessarily. But what is for sure, this is going to happen anywhere in the world, is that the customer is going to get a better and better deal, so you had better get a more efficient at doing what you do.
( so we can find the darn thing
)
