Big Four failing to satisfy HNWIs
Banking consumer satisfaction levels are at an all-time high, but the Big Four are struggling to boost their share of high net worth individuals' (HNWIs') wallets, Roy Morgan Research reveals.
Data from the latest Roy Morgan Single Source survey found that the satisfaction level of personal banking customers in the six months to August 2015 was 82.8 per cent — just shy of the record high in March of 82.9 per cent.
However, the research found that banks were struggling to meet the needs of their high value clients, who account for almost two-thirds of the total value of the financial services market.
The survey found that customers of the Commonwealth Bank of Australia (CBA) reported the highest satisfaction ratings of the Big Four (82.6 per cent), ahead of the National Australia Bank (NAB) (81.9 per cent), Westpac (80 per cent), with the ANZ trailing on (79.4 per cent).
However, all four of the major institutions trailed the industry average (78.2 per cent) when it came to satisfying their high value clients, with NAB topping the list with a 77.5 per cent satisfaction rating, while the CBA recorded a rating of 76 per cent.
Roy Morgan Research industry communications director, Norman Morris, said the survey's findings highlighted an opportunity for the Big Four to focus on meeting the needs of HNWIs.
"With a market that is as highly skewed as finance, where 20 per cent account for nearly two thirds of the market value, performance in this segment is in need of more attention if banks are to achieve longer term financial gains," he said.
"The top quintile currently not only has the lowest satisfaction level of the major banks but it also has the lowest share of wallet of all the segments. All of the major four banks have less than a third of their top quintile customers' wallet.
"Achieving a higher share of wallet with this group represents a considerable challenge but they are clearly the segment with the highest potential for business growth and as such are likely to be more profitable than chasing new low value customers."
Recommended for you
It can be extremely hard to realise the gains from financial advice M&A, according to Peloton Partners’ Rob Jones, and more could be gained from firms looking inward at their own practice.
With platforms reporting their quarterly results, there is a clear divide in the adviser markets they are targeting, according to platform specialist Recep Peker, and which would be right for your clients.
The Federal Court has imposed a $10 million penalty on Macquarie Bank for failing to prevent and control unauthorised fee transactions by third parties including financial advisers.
A financial advice firm has seen a weekly decline of 10 advisers, with all moving to a new licensee, while Centrepoint Alliance continues its “growth story”.
