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Transcript: Anna Bligh on ABC Afternoon Briefing

Transcript: Anna Bligh on ABC Afternoon Briefing

21 October 2022

Anna Bligh appeared on the ABC’s Afternoon Briefing program on Thursday 20 October 2022.

This is the transcript of Anna Bligh’s interview with Matthew Doran that covered APRA’s recently released points of presence report, and how banks and Australia Post are working together in small towns to continue to provide service to bank customers who still need face-to-face banking.

Also covered – the massive transformation away from physical banking to digital banking, and the need for a strong stable banking industry to help support the economy during shocks like COVID.


Matthew Doran: New analysis from the banking regulator APRA shows 1600 bank branches closed across the country in the last six years, more than 300 in the last financial year alone. It’s leading to obvious questions of whether banks are deserting their communities and the eternal rush to bolster profits. Anna Bligh is the chief executive of the Australian Banking Association, and she joined me earlier from Brisbane. Anna Bligh, welcome to afternoon briefing, this new data that’s come from APRA showing such a large volume of bank branches closing over the last six years or so. What’s the rationale behind that? From the bankers perspective? Why is that happening across the country?

More and more Australians are moving at a faster pace than they ever have to move their banking online. The bank branch of the future is the phone that you carry in your back pocket.

ABA CEO Anna Bligh

Anna Bligh: What you’re seeing in Australia is a massive transformation in the way that Australians use and seek baking services. More and more Australians are moving at a faster pace than they ever have to move their banking online. The bank branch of the future is the phone that you carry in your back pocket, or the laptop that’s sitting on your kitchen bench.

Less and less people are seeking bank branch services face-to-face. So banks are transferring their resources to where their customers are. They’re putting their resources into protecting customers online from scams and fraud and cyber attack and keeping them as safe as they can, while they access their banking services online.

But banks are also very aware that there are still people in our community who are not comfortable banking online, and who want face-to-face services. And that’s why we still see more than 4000 branches of banks open around the country. And Australia’s banks also pay Australia Post to provide basic banking services like access to cash, getting a cash float, depositing money at every Australia Post, office and outlet. And there are three and a half thousand of those across Australia.

So we’re in this incredible period of flux. And banks are struggling with system that is getting less and less use and trying to make sure they’re adequately resourcing the system, the online system that’s getting more and more and more use from all Australian customers.

Matthew Doran: How difficult is it to make that balance between ensuring that branches are actually being utilised by the community and also wanting to keep services there to pick up on that? I guess it’s been called a sort of social contract with the community as well?

There are still… seven and a half thousand places in Australia, bricks and mortar, whether it’s a post office or a bank branch, where you can get face-to-face services. And that’s a very big footprint for a country of this size.

Anna Bligh: Well, I think there are, there’s a bit of a view that bank branches are closing in areas where there’s population decline, and nothing could be further from the truth. If you look at the branch closures this year, 90% of them are in Australia’s capital cities, or in the largest regional cities. And these are all areas of population growth. So what we’re really seeing is significant changes in customer behaviour, and customer expectations. People want to pay their bills sitting up in their pyjamas on a Saturday night – not going into a branch to do that.

And so banks, you know, change is never easy. And we are right in the middle of probably one of the biggest transformations ever seen in Australian banking. And so yes, banks are struggling the expectations of one part of the community and juggling that with the expectations of increasingly the bulk of their customers.

And I think, you know, there are still, as I said, seven and a half thousand places in Australia, bricks and mortar, whether it’s a post office or a bank branch, where you can get face-to-face services. And that’s a very big footprint for a country of this size.

What we’re really seeing is significant changes in customer behaviour, and customer expectations. People want to pay their bills sitting up in their pyjamas on a Saturday night – not going into a branch to do that.

Matthew Doran: I can think of better things to do on my Sunday night than paying bills sitting on the couch. But I do take your point there. Let’s look at this issue of regional communities in particular, a lot has been made about the decline of services, not just in banking, but also other services in regional communities. I know that there are investments and partnerships with Australia Post to provide those sorts of services. But isn’t that shifting responsibility to another organisation rather than these banks looking after their customers with primary responsibility?

Anna Bligh: No, I think it’s a way for banks to meet their responsibilities to their customers in the most cost-effective way. You know, the money that sits in banks is your money. And I think every customer wants banks to use their money effectively and efficiently and wisely, and putting money into Australia Post and contracting them. They’ve already got three and a half thousand outlets around the country. I think it makes a lot of sense. I think it’s a smart way to make sure that customers wherever they live, can access face-to-face services get cash, to all their basic banking.

I don’t think there’s a single place in this country where a bank branch has closed where there is not an Australia Post outlet. Also, for many of those places in very small towns, those Australia Post outlets are operated by small businesses in town, they’re contracted, the local newsagent runs the Australia Post business. And they get bank business that keeps that small business viable.

So there’s a lot of win-win in this for small communities: they keep their small businesses because they’ve got an additional diversified source of income. And they keep access to face-to-face banking services, for those that want it.

But I think we should also understand that people who live in regional and remote parts of this country are some of the earliest adopters of online services. And, you know, there are just as many people in regional Australia who are doing all of their banking on their app on their laptop, and who haven’t probably can’t remember the last time they went into a branch.

So there’s a lot of win-win in this for small communities: they keep their small businesses because they’ve got an additional diversified source of income. And they keep access to face-to-face banking services, for those that want it.

Matthew Doran: Is there a cost-saving measure here as well as that transition? I mean, we look at the huge profits that are being recorded in the banking sector. I think Commbank is the only one of the big four that’s actually released its full-year profits. But that’s sitting at $9.6 billion for the last financial year, all the banks are making this transition. But is there a cost-saving measure there, are profits being put ahead of good service?

Anna Bligh: No, I don’t think that’s a reasonable conclusion. Firstly, I’d say I think what COVID taught us is just how important it is for our country, to have strong profitable banks that are there with well capitalised to absorb economic shocks when they come along, I don’t think ever in Australia we want is a situation where our banks are not making strong and healthy profits.

And of course, in Australia, because of our system of superannuation, if you are a working Australian bank profits are going into your superannuation and your retirement income. So I don’t think we should wish those away too easily. Because it’s a very important part of our superannuation system.

But really, what we’re seeing is a transfer of the costs of running branches, going into the employment, increasingly, of more and more software engineers, coders and similar skills to ensure that the increasing number of Australians who are doing all of their banking online, are as protected as they can be from scammers from cyber-attacks and from fraud.

I think the basic obligation of banks forever has been to keep people’s money safe. And keeping it safe online. It might be invisible, you know, you can see a bank branch and you can see what banks are spending money on. It’s not very visible, what’s happening when you’re online banking, but there’s an enormous cost and investment required by banks every single year, to protect customers’ money. We used to put it in cast iron vaults. Now it’s being protected by some of the best software engineers in the country. And that’s not going to change.

What we’re seeing is a transfer of the costs of running branches, going into the employment, increasingly, of more and more software engineers, coders and similar skills to ensure that the increasing number of Australians who are doing all of their banking online, are as protected as they can be from scammers.

Matthew Doran: Just finally, let’s pick up on that issue of security because there has been, I guess, heightened awareness about things like cyber security in the last couple of weeks with the Optus data breach, we’ve now got the Medibank cyber-attack, that’s also happened, how on edge is the banking sector to these sorts of threats.

Anna Bligh: Look, I think every bank CEO, from our smallest to our largest banks, would tell you that cyber security is constantly in their top three things that keep them awake at night. It’s one of the issues that the industry has been working together to ensure they are exchanging information wherever they see unusual activity in their own networks. And they’re working with regulators like APRA, to make sure that Australian banks are keeping customers’ money as safe as we possibly can. But you know, this is the reality of Australia becoming an increasingly digital economy.

Once upon a time, even with the best bank vaults and the best security guards, we still saw armed bank robbers sometimes, you know, attacking banks and getting customers’ money. We can’t see the bank robbers anymore. They don’t turn up with masks and guns, they’re probably sitting in a garage somewhere in another part of the world using algorithms to try to get into bank data. And banks know that their job is to keep one step ahead of those hackers. And it costs money, you can’t see it like you can see a bank branch, but it’s a big investment.

And as I said, that’s one of the reasons banks have to get the balance right. You know, keeping the old network as well structured as it can be for the need of those customers who still need it, as well as building the new network and the new online platforms and protecting them as more and more and more Australians every single day jump into that new online environment.

Matthew Doran: Anna Bligh, thank you for your time.

Video of this interview is available on ABC iview.


Find out more about the future of banking in Australia.


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