Source: Roy Morgan Consumer Banking Satisfaction Report Sept 2016, average 6-month sample n=25,600
Following a marginal increase in August (up 0.1% point), satisfaction among banks’ personal customers again showed a small increase in the six months to September 2016 with 81.7% of customers being satisfied (up from 81.6% in August 2016). This level is well above the long-term average and is not far off the 20-year high (82.9%) recorded in 2015. The improvement over the last two months was due to increased satisfaction among non-home loan customers (up 0.3% points to 81.8%) but home-loan customers declined (down 0.8% points to 78.3%). These are the latest findings from Roy Morgan’s Single Source survey of 50,000+ consumers pa.
Customer satisfaction with the big four banks improved a little in September (up 0.1% point to 79.8%) but their home-loan customers’ satisfaction remained unchanged on 75.9%. Non-home loan customers’ satisfaction on the other hand was up by 0.1% point to 80.7%.
CBA increased its lead among the big four in September
In September, the CBA showed the biggest improvement in satisfaction among the big four (up 0.6% points to 82.0%) and it remains the big four market leader. The NAB was the only other major bank to improve (up 0.1% point to 78.0%). The ANZ declined by 1.1% points (to 78.8%) and Westpac was down by 0.3% points to 77.3%.
Consumer Banking Satisfaction
Source: Roy Morgan Consumer Banking Satisfaction Report Sept 2016, average 6-month sample n=25,600
The CBA’s improvement in September was due to an increase in satisfaction among both their home-loan customers (up 1.8% points) and their non-home loan customers (up 0.4% points to 82.9%). ANZ’s decline in September was driven by drops among both their home-loan customers (down 2.8% points to 75.7%) and among their non-home loan customers (down by 0.7% points to 79.6%). Westpac’s decline came from its home-loan customers (down 1.5% points to 74.5%), while the NAB showed gains among home-loan customers (up 0.6% to 73.8%) but a marginal decline among other customers (down 0.1% point to 79.1%).
Among the banks outside of the big four, the best performer for customer satisfaction was Victorian Teachers Mutual Bank (95.3%), followed by Greater Bank (95.2%), Bank Australia (93.7%), Teachers Mutual Bank (93.5%) and Heritage Bank (90.2%).
Mortgage customers of the big four remain a drag on satisfaction
The mortgage customers of each of the big four continue to be a drag on their overall satisfaction but the CBA and NAB’s mortgage customers are showing some signs of closing the gap on their other customers. The ANZ and Westpac’s mortgage customers, on the other hand, are falling further behind. Despite some improvement, satisfaction among the NAB’s mortgage customers remains the furthest behind that of their other customers (73.8% compared to 79.1%), followed closely by CBA (77.7% compared to 82.9%).
Satisfaction of Mortgage and Non-Mortgage Customers*
Source: Roy Morgan Research Single Source: April - September 2016, n = 26,076.
Bendigo Bank has the highest home-loan customer satisfaction (of the 10 largest consumer banks) with 94.3% of its customers satisfied, followed by ING Direct on 93.8%. These two are well clear of their nearest competitor, Suncorp with 85.5%. The CBA has the highest home-loan customer satisfaction of the big four with 77.7%.
‘Very satisfied’ customers more ‘likely to recommend’ their bank
A great deal of attention is currently focused on increasing ‘advocacy’, the likelihood of bank customers recommending their bank (‘high advocates’). Across all the major banks, customers who indicate that they are ‘very satisfied’ are much more likely to strongly recommend their bank to others, rating their bank 9 or 10 on a 10-point scale. Customers who indicate that they are only ‘fairly satisfied’ are less likely to strongly recommend their bank to others.
The chart below shows how ‘satisfaction’ is made up of ‘very satisfied’ and ‘fairly satisfied’. Of the top ten major banks, Bendigo Bank and ING Direct have the highest proportion of ‘very satisfied’ customers (50.5% and 50.0% respectively) and as a result they have much higher proportions of customers being ‘highly likely’ to recommend them (‘high advocates’).
Consumer Banking Satisfaction - Top 10 Major Banks*
Source: Roy Morgan Research Single Source: April - September 2016, n = 26,076
It is important to note that the average proportion of ‘very satisfied’ customers across all banks is only 35.9%, which gives plenty of scope for improvement in both satisfaction and advocacy.
Norman Morris, Industry Communications Director, Roy Morgan Research says:
“It is a positive sign that despite the high-profile negative publicity surrounding the recent banking inquiry, the big four banks have in fact increased their customer satisfaction levels over the September quarter. Having been measuring bank customer satisfaction for over 20 years, Roy Morgan can say that customers currently have a generally positive view of their own bank and, contrary to much of the short-term negative reporting, there has been a solid upward trend over the last 15 years.
“Although home-loan customers have historically had lower satisfaction than other customers, it is surprising that this is still the case given the very low loan and deposit interest rates that favour borrowers. Over the last year, home-loan customer satisfaction has in fact fallen further behind that of other customers by another 2.4% points.
“Many banks are now looking at advocacy as a measure of their performance as well as satisfaction. We have seen in this research that customers who are ‘very satisfied’ with their bank are around three times more likely to be ‘high advocates’ (rating their bank 9 or 10 out of 10) than those who are only ‘fairly satisfied’ with their bank. There is great potential to increase advocacy through converting more of these ‘fairly satisfied’ banking customers into ‘very satisfied’ customers. In view of this, it makes sense for more attention to be given to tracking the level of the ‘very satisfied’ for each bank.
“With over 50,000 interviews conducted annually for more than 20 years, Roy Morgan data has become the currency in retail financial services. Its size enables an in-depth understanding of financial behaviour and trends, providing unique and detailed insights for anyone involved in the financial services market. Customer satisfaction and advocacy are just are just some of the metrics that are capable of being analysed in much greater detail than in any other survey of the Australian retail financial services market.”
For comments or more information about Roy Morgan Research’s banking and finance data, please contact:
Norman Morris
Office: +61 (3) 9224 5172
norman.morris@roymorgan.com