One message to come out of the Bank of Queensland's annual general meeting was that an improving performance in regional areas should not be seen as a reason to tighten policy or ease off on working toward a more equitable banking environment.
In his opening remarks, BOQ's chairman Roger Davis listed the results of steps he had taken to reverse the bank's fortunes. These included a 20 per cent lift in after tax earnings, an increase in cash net interest margin of 13 basis points to 1.82 per cent, ratings upgrades by all three major agencies, increased dividend payout and a lift in the bank's Common Equity Tier 1 ratio of 8.63 per cent.
But these, he conceded, were countered by increased costs while the bank played catch-up on technology - which may be holding customers back from agreeing with the BOQ's newly adopted slogan, "It's possible to love a bank", if a shareholder's question about the choice of slogan and whether it was "market-tested" is any guide.
Davis conceded the bank's current overreliance on paper-based processes were delaying the "time to yes".
He also acknowledged the departure of CEO Stuart Grimshaw, but remained bullish over several major changes that dated from Grimshaw's watch:
- the acquisition of the former Investec specialist finance business, now renamed BOQ Specialist (which "promises high returns and manageable risks in the rapidly growing health sector") and Investec's asset finance business, now part of BOQ Finance,
- increased business in the mortgage broker lending market, and
- a renewed focus on small business lending and agribusiness.
Davis claimed that Virgin Money Australia had "delivered profitability ahead of our expectations" and offered "access to new customers that were otherwise unattainable through BOQ's traditional banking network."
He also repeated the mantra of all regional banks: high house prices in Sydney and Melbourne should not induce the RBA to impose macroprudential measures across the country, with unintended consequences elsewhere.
His colleague, acting CEO Jon Sutton (right) explained the four pillar strategy "designed to help us achieve our dream of creating Australia's most loved bank", which are:
- "Opening more doors to more customers by putting the customer in charge" - for example BOQ's entry into the mortgage broker market.
- Balancing risk and return, or "growing the right way" - for example, through Business Bank diversification.
- Becoming more operationally efficient, finding that there's always a better way.
- Having the right people, capability and culture to ensure success, "or being loved like no other."