RETAIL BANKING | Staff Reporter, Australia

Bank satisfaction deep dives in Australia after damning probe

The number of customers unlikely to recommend their bank hit a two-year peak.

Bank customer satisfaction in Australia fell from 82.3% in January to 78.5% in May following a probe by the Royal Banking Commission uncovering widespread industry malpractice in the financial services sector, according to a survey from market research firm Roy Morgan. 

This represents the lowest monthly showing in six years but still remains ahead of 60% low recorded in 2001.

“It is not surprising given the current level of negative publicity involving banks and the Royal Commission, that satisfaction with banks and customer advocacy levels are showing declines from the start of 2018,” said Norman Morris, Industry Communications Director, Roy Morgan says.

Also read: Australian watchdog seeks staff integration into misbehaving banks to intensify oversight

On the other hand, the level of dissatisfaction, although being relatively low, increased from 4.6% in January to 6.2% in May, representing a four-year peak.

The number of customers likely to recommend their banks to others also dropped from 55.4% in February to 52.2% in May whilst the number of customers unlikely to recommend their bank hit a two year peak at 9.4%.

The country’s largest lenders are facing their worst crisis in years after a probe revealed rampant corporate wrongdoing at the banks from lying to regulators to falsification of documents to taking bribes. As a result, foreign players like Barclays and Societe Generale have been lining up to get a chance at the country's $3.5t banking market as local lenders reel the inquiry. 

Also read: Australian bank inquiry could cut 8% of country's finance jobs

“The banks didn’t start this way, they’ve just evolved into it. To produce products—whether they happened to be superannuation or a new managed fund—and at the same time offer advice on that, they were able to get fees all the way through the system,” Ian Ramsay, professor of commercial law at Melbourne University told Bloomberg.

Do you know more about this story? Contact us anonymously through this link.

Click here to learn about advertising, content sponsorship, events & rountables, custom media solutions, whitepaper writing, sales leads or eDM opportunities with us.

To get a media kit and information on advertising or sponsoring click here.