Smaller banks continue to lead in customer satisfaction

The satisfaction level of the big four banks’ personal banking customers in the 6 months to July 2015 was 81.3%, which was up 0.8% points from July 2014 (80.5%). Despite this improvement, the banks other than the big four still have a clear lead with 86.0% satisfaction in July 2015, which was up 0.5% points from July 2014 (85.5%).

These are the latest findings from Roy Morgan’s Single Source survey of over 50,000 people pa.

CBA regains top satisfaction spot among the big four

Competition among the big four banks for top ranking remains close, with CBA narrowly regaining top position from the NAB for overall satisfaction with 82.3% (NAB 82.2%). In terms of MFI (Main Financial Institution) customer rankings, CBA also retains top position with 84.3%, closely followed by NAB (84.2%), Westpac (82.4%) and ANZ (82.3%).

Among the banks outside of the big four, Teachers Mutual Bank remained the best performing bank overall with 95.1% of its customers satisfied. It is worth noting that Bank of Melbourne (90.3% satisfaction) and St George (84.5%) were both clearly ahead of Westpac (80.1%).

Consumer banking satisfaction
customer-banking-satisfaction-graph

Source: Roy Morgan Research Consumer Banking Satisfaction Report, July 2015, average 6-month sample n=25,630.

Among the big four, NAB was the most improved over the last 12 months (up 2.2% points), followed by CBA (up 0.8% points) and ANZ (up 0.3% points), while Westpac was down by 0.1% points.

Home-loan customers of the big four show improved satisfaction but trail smaller banks

Although the satisfaction levels of the home-loan customers of each of the big four improved over the last 12 months, they remain below the levels of their non-home loan customers and well below the satisfaction levels of the smaller banks’ home-loan customers.

Satisfaction of home loan customers cf. other customers*
graph
Source: Roy Morgan Single Source, February 2015 – July 2015 (n = 25,880).

Among the ten major home-loan banks, ING Direct home-loan customers have the highest satisfaction with 93.2%, followed by ME Bank (90.9%) and Bendigo Bank (89.3%). These three banks are unique among the top ten in that their home-loan customers have higher satisfaction levels than their non-home loan customers. The CBA home-loan customers’ satisfaction is the highest of the big four with 81.5%, followed by Westpac (79.8%).

Norman Morris, Industry Communications Director, Roy Morgan Research says:

“The decline in home-loan rates, and the flexibility now offered by the major banks in regards to how customers can deal with them (ie channel selection ),have been major contributors to overall satisfaction gains across the banking sector. The banks outside of the big four have retained their lead in satisfaction which they have held for more than a decade, and although the gap has closed to some extent, they still retain a considerable lead over their larger competitors.

“The big four banks generally compare their satisfaction levels with each other, and yet it is generally the smaller banks that set the standard for both overall satisfaction and the very important home-loan segment. In a period where home-loan rates have been declining, it is still somewhat surprising that home-loan customer satisfaction across banks overall remains below that of other customers—particularly considering that many non-home-loan customers are being adversely impacted by low deposit rates. A number of smaller banks have shown however that it is possible for their home-loan customers to be more satisfied than their other customers. As such, they are setting the standard for others to follow in the highly competitive home loan market.”

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