Laiki aims to lose the Greek community bank tag

Laiki Bank is putting the finishing touches to a marketing campaign that will start at the end of the month. After eight years in Australia, during which time it has developed a comprehensive product set for its retail and small business customers, the bank feels the time is right to establish an identity outside the local Greek community.

Don't expect to see a national television or newspaper campaign. Laiki is small, with assets of $1 billion split evenly between mortgages and SME loans.

It will be using its 10 branches as the focus for some community-based marketing and it will use the internet for some direct marketing.

Laiki Bank Australia general manager Michael Athanasiou said that with the consolidation that has occurred in the market over the past couple of years, it is a good time for banks like Laiki to promote themselves as alternatives to the big four.

Athanasiou said: "Part of our marketing will be to let people know that we are part of a large institution that has been operating for 110 years."

Laiki's parent has an A3 rating from Moody's. The local bank is not rated; all of its funding comes from customer deposits.

Athanasiou said the bank had a strong liquidity position and its asset quality was in line with or better than system. Laiki offers only secured loans and does not issue a credit card (it offers Visa debit).

Laiki is promoting all the positive attributes of a small financial institution. It is flexible, accessible and the service levels are high.

Athanasiou said:  "In our SME business we lend $1 to $5 million and maybe up to $10 million in certain cases. All those customers get a relationship manager.

"We don't do a product package sale with our business customers. If they want a small commercial loan to be made up of a fixed rate portion, a variable rate portion and some in an overdraft we will do that for them."

The bank's commercial product set includes electronic banking, cash management and other treasury services. The bank has recently launched a foreign exchange service.

It has also been sprucing up its retail offering. Last year it launched a home loan called Options Plus, which has a 100 basis point discount for the first year, no application fee, 100 per cent offset and redraw and access via ATM and cheque book.

Laiki's marketing manager, Spiro Kanellakis, said the bank decided to put product details on InfoChoice and other consumer websites and set the rate at a level where it would get attention (the current intro rate is 4.89 per cent).

Laiki does not distribute its mortgages through the broker network.

Its retail offering also includes a high-interest savings account, Smart Saver, and an electronic banking platform.

Athanasiou has set a growth target of 12 per cent in assets and liabilities for this year. He is confident of meeting that target because the market is not so crowded.

He agrees with comments made by regional bank chiefs in recent weeks about the way the government guarantee arrangements have helped the big banks more than others in the market.

Because Laiki does not raise wholesale funds he is not concerned about that aspect of the scheme but he believes the government should make the cost of the guarantee on retail deposits over $1 million the same for all deposit taking institutions.