A mutual bank celebrating its 115th year with growing profits has said to “watch this space”.
Newcastle Permanent put out its financial results overnight, showing its net profit after tax up by 12.4% on the year before. Its home loan portfolio has grown by 4.4% to $8.9billion.
CEO Terry Millett said it’s not just a great year for the bank, but it’s been a great year for their customers.
The lender was ranked the number 1 financial institution in Australia by customer satisfaction according to national research firm Roy Morgan. It also received a number of accolades, including Mortgage Choice’s National 2nd Tier Lender award.
Talking to Australian Broker about the plans for the next financial year, Millett said digitisation was a huge priority to make things easier for both customers and brokers.
Excited for the plans, he said, “Watch this space, guys! Where the major banks are sitting round in parliament and pontificating about all these things they have done wrong, people like us are motoring away.”
He added, “[Digitisation] is quicker, it’s more efficient, plus it gives us stronger control. It’s obviously the first steps of our brokers being able to submit applications digitally and we’re building back from that to create more of the processes to be able to be done digitally, like some of the annoying bits.
“We’re part of PEXA and that’s wonderful. Then we’re obviously working hard towards digitising our documentation so we can have documents received and exchanged and send digitally so no more snail mail and all that.
“We’re also working on the valuation and credit assessing process for home loans, which for a portion of our home loans we’re moving to a digital assessing process.
“All of this is designed to give customers a faster better experience. Plus also the ability to see where applications are in progress. It allows us to deliver more and more of our revenue into investment to stay in front.”
Emphasising how important customers were to Newcastle Permanent, he said, “To give you a feel, one of the classic mistakes in this industry is the home loan arrears rates. In our mind it’s not the cost, it’s how good are you ensuring the customers are not in over their heads.
“Our home loan arrears rate is a tenth of the major banks. We really don’t want customers to get into a bad experience.
“There is a reason why in the Royal Commission in the banking sector all of the issues have been related to the four major banks and in my mind, why are they generating those issues?
“This issue of how we balance the interest of the shareholders and the customer and people in the community is critical. We live and breathe for our customers who own the organisation and the communities we’re part of.
“I do see that in the major banks they’re primarily focused on making returns for their shareholders. But that can lead to the customer getting a poor outcome.”