BOQ’s new strategy is built on five pillars, chief among which is a digital transformation hinging on the implementation of digital and cloud based technologies that would see it have “all the strengths of an established bank, with the digital agility of a neobank.”
“BOQ will build on its key strengths, differentiators, and strong customer engagement through an improved digital offering to deliver sustainable performance improvement,” said Managing Director and CEO George Frazis.
“Our strategy combines traditional banking with contemporary digital capabilities to better serve our customers, deliver better products and services, be nimble and improve productivity.”
The bank is aiming to streamline its product offerings and IT systems as part of that digital transformation strategy. Currently, BOQ has around 15 core product platforms and hundreds of applications, but will develop a new common retail platform with its investment in Virgin Money Australia’s new cloud-based digital bank and loyalty program.
“This five-year strategy is the next iteration of a bank that has served its customers for 145 years,” Mr Frazis said.
“We will build on our existing competitive advantages in the knowledge that customers are increasingly looking for alternative ways to bank.”
The bank will shell out $100 million per annum before reducing to $80 million per annum in FY23 and $60 million in FY24. The investment will be partially financed through efficiency and productivity benefits that will save an anticipated $90 million by FY23.
Other parts of the bank’s five-year strategy include focusing on its “empathetic culture” and “niche customer segments” that will provide the greatest opportunities to grow sustainable returns.
“The work is underway and we are starting to see improvements across key metrics including customer satisfaction, home lending and business lending growth,” Mr Frazis said.
“BOQ is moving with pace and will build on this early momentum in the months ahead. I’m confident that we have the right strategy and roadmap to grow the business in a way that delivers for customers, shareholders and our people.”
BOQ also revised its guidance, anticipating FY20 cash earnings to be 4 to 6 per cent low than FY19 amidst income growth and an improved impairment outcome.