Latest / Best of Business / Vittoria Short: ASB CEO on the bank reporting profit drop to $1.3 billion for the year

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Vittoria Short: ASB CEO on the bank reporting profit drop to $1.3 billion for the year · Best of Business

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  Speaker 2: Now it's steady as she goes for ASB Bank has
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  Speaker 2: reported a net profit after tax cash profit after tax
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  Speaker 2: of one point three billion dollars for the year to
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  Speaker 2: June thirtieth. That's down two percent on the year before.
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  Speaker 2: Victoria Short is the ASB chief executive. Hi Viatoria, Hey there, Heather.
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  Speaker 2: That drop is that largely down to the cost of
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  Speaker 2: the class action.
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  Speaker 3: So the drop is largely down to a threatning certainly inflation,
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  Speaker 3: you know banks, not only inflation. It's been a lot
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  Speaker 3: of it, including on technology. We've also had a very
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  Speaker 3: big investment in technology that's driving our expenses up. And
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  Speaker 3: then yes, we've had the cast action.
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  Speaker 2: Yeah, So apart from obviously what you've just mentioned, does
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  Speaker 2: business otherwise much of the same as it has been,
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  Speaker 2: like just tacking along nicely.
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  Speaker 3: We've been really pleased actually that more customer the choosing
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  Speaker 3: asp so we have grown at or above the market
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  Speaker 3: across every single part our business. It's home loans, that's
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  Speaker 3: business lending deposits and also key with faver.
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  Speaker 2: What do you put that down to.
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  Speaker 3: We've been working really hard to make sure that we
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  Speaker 3: are being consistent and that we're finding ways to support
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  Speaker 3: our customers. And just as a quick example, the cost
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  Speaker 3: to provide a home loan, to say a one one
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  Speaker 3: year home loan, because of the Middle East volatility, that
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  Speaker 3: cost increased by eighty three basis points for home loans.
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  Speaker 3: We've only passed on half of that to our customers.
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  Speaker 3: Is this testament of a shock absorber. Yes?
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  Speaker 2: Is this testament to the fact that there is actually
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  Speaker 2: quite a fair bit of competition in the banking sector.
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  Speaker 3: There's a ton of competition in the banking sector, and
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  Speaker 3: there's more and more competitors coming and all the time.
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  Speaker 3: So you know, we've really got to be at the
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  Speaker 3: top of the game. Ok.
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  Speaker 2: Know, you've talked a little bit about streamlining ASB and
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  Speaker 2: modernizing the business. What do you mean by that?
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  Speaker 3: So we've been really investing in technology and new processes,
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  Speaker 3: bringing different skills and people into our business. A couple
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  Speaker 3: of like really quick examples, our new contact center in
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  Speaker 3: conjunction with AI that we've put into the contact center
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  Speaker 3: means that we're reduced the turnaround times by forty percent
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  Speaker 3: for the core wait times So that's just a really
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  Speaker 3: good example of new system AI people all contributing to
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  Speaker 3: make it easiest our customers to reta.
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  Speaker 2: Now it won't have escaped your attention. I'm sure this
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  Speaker 2: week that the National Party hasn't made it clear that
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  Speaker 2: they're looking at a banking tax next term. What do
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  Speaker 2: you make of that?
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  Speaker 3: Yes, but the banking tax is out for consultation. So
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  Speaker 3: we just got that this week and the team will
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  Speaker 3: be going through and having a look at it.
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  Speaker 2: I think we're talking about two different things.
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  Speaker 3: That's the part.
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  Speaker 2: Of prudential levy that you're talking about, is it?
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  Speaker 3: Yeah?
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  Speaker 2: Yeah, yeah, So they're talking about another tax on top
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  Speaker 2: of that. How would you feel about that?
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  Speaker 3: I think the banks pay their full tax. We're really
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  Speaker 3: big at tax payers in New Zealand. We pay our
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  Speaker 3: full tax. We're very big employers and we support the
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  Speaker 3: economy through supporting a lot of New Zealand suppliers. So
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  Speaker 3: I think, you know, the ASP we really participates fully
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  Speaker 3: in the New Zealand country.
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  Speaker 2: All right, now, listen to the economic recovery. How's it
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  Speaker 2: looking to has it already started?
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  Speaker 3: Look, the economic recovery has been stopped start and the
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  Speaker 3: biggest thing is it's been uneven. It's uneven across regions,
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  Speaker 3: it's uneven across sectors. Things that we are really closely
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  Speaker 3: watching for though, is business confidence. We can see in
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  Speaker 3: our pipeline that businesses are getting ready to invest more
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  Speaker 3: or bring on more in terms of employment, but not
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  Speaker 3: just yet. So we're watching pet crisis, We're watching net
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  Speaker 3: migration for that strengthening, and we know that from what
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  Speaker 3: we can see, there's a lot of rebilience in our businesses.
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  Speaker 3: So an interesting fat there is year on year households
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  Speaker 3: and businesses and difficulty has brought by twenty five percent.
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  Speaker 3: So we're definitely saying impostments.
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  Speaker 2: All right, Victoria, as always, it's lovely to talk to you.
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  Speaker 2: I really appreciate your time. That's Victoria Short, the ASB
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  Speaker 2: Chief executive.
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