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BNZ Announces Changes to GlobalPlus Products

29 July 2004

For immediate use

Bank of New Zealand Announces Changes to GlobalPlus Products

One of New Zealand's most successful loyalty brands, GlobalPlus, is set to be enhanced to ensure it remains a leader in the credit card and home loan loyalty market.

The changes to the GlobalPlus products will be supported by a new television and print advertising campaign that gets underway in mid-August.

Bank of New Zealand announced the changes to the GlobalPlus products today.

The changes are effective from 16 November 2004. Most of the changes are a result of the enhancements that Air New Zealand is making to its Airpoints loyalty programme.

The notable changes to GlobalPlus are:*

- introduction of a new loyalty currency - Air New Zealand Airpoints DollarsTM - that will replace Airpoints from 16 November (this change is directly in line with Air New Zealand's changes to its Airpoints programme)

- new earning rates, for GlobalPlus credit cards and GlobalPlus home loans, will apply from 16 November

- new redemption options for GlobalPlus customers, under which Airpoints Dollars can be spent on non-flight rewards

- new earning rates for GlobalPlus customers who are LoanCare or LifeCare policyholders (Airpoints Dollars will not be available to new LoanCare and LifeCare policyholders from 16 November 2004)

- 10,000 bonus Airpoints, offered on drawing down a loan, will no longer be available from 16 November

- increases in annual fees for GlobalPlus credit cards applicable from 16

November

* Further details of changes set out at the end of this release.

Under the changes, most GlobalPlus customers will enjoy reward-earning rates that are either equal to or better than the earning rates they currently enjoy. Further, the combination of the changes to GlobalPlus and Air New Zealand's Airpoints will mean GlobalPlus customers enjoy considerably more flexibility to use their rewards.

The most important changes announced by Air New Zealand today, to its Airpoints programme, mean that:

- customers will be able to use their Airpoints Dollars to purchase every seat available for sale on every Air New Zealand ticketed and operated flight

- each Airpoints Dollar will be equivalent to one New Zealand dollar for New Zealand-resident Airpoints customers, so that customers will be able to work out precisely what their rewards will buy in airfares.

"Most customers will get a better all round deal from 16 November when the changes to GlobalPlus and Air New Zealand's Airpoints are effective," said Bank of New Zealand General Manager of Cards, Pradeep Roy.

"As a result of the changes that Air New Zealand is making to its Airpoints programme, it'll be easier to get seats on flights and it will be easier to know what your rewards are worth."

"For GlobalPlus customers specifically, there will be more ways to redeem your Airpoints Dollars."

"We recognised that it was time to review the GlobalPlus products and the position that GlobalPlus has in the loyalty market."

"Since GlobalPlus was launched in 1998, other loyalty products have entered the market. In order to ensure GlobalPlus remains where it belongs - which is at the forefront of the market - we're undertaking enhancements now."

Mr Roy said cards customers could enjoy double the standard earning rate under an exciting current promotional offer involving the GlobalPlus American Express card (until 31 March 2005). "We're making it easy for customers to earn even more points through this offer," Mr Roy said.

GlobalPlus will inform customers of the details of the changes to credit cards, home loans, and insurance in direct mail that is being sent shortly.

Among the enhancements announced today is the introduction of a new redemption programme under which GlobalPlus customers can spend Airpoints Dollars on non-flight rewards. The new redemption programme is being introduced in response to demand from customers who say they want the flexibility to spend their rewards on goods and services other than flights.

More than 300,000 customers enjoy the benefits of a GlobalPlus credit card and GlobalPlus home loan.

A new television and print campaign - featuring a series of new television commercials - will begin in mid-August. "The new advertising campaign marks an evolution in the GlobalPlus brand, rather than a revolution. The heart of the brand - which is adventure and aspiration - remains, but it will be articulated in a new way," said Mr Roy.

Ends

- Tables below set out new and existing earning rates for GlobalPlus credit cards and new and existing annual card fees.

New Credit Card Earning Rates:

Standard GlobalPlus Gold GlobalPlus

Standard Earning Rates Promotional Rate **

(until 31 March 2005) Gold Earning Rates Promotional Rate** (until 31 March 2005)

American Express $150 spend=AP$1 $150 spend=AP$2 $100 spend=AP$1 $100 spend=AP$2

Visa/Mastercard $150 spend=AP$1 N/A $100 spend=AP$1 N/A

** GlobalPlus American Express card offers customers the opportunity to earn double the standard rate until 31 March 2005.

Standard GlobalPlus Gold GlobalPlus

Current Fees New Fees

Effective

16 November Current Fees New Fees

Effective

16 November

American Express $17.50 half yearly $27.50 half yearly $47.50 half yearly $52.50 half yearly

Visa/Mastercard $17.50 half yearly $27.50 half yearly $47.50 half yearly $52.50 half yearly

GlobalPlus Visa/MasterCard Earning Rate

Today Earning rate is 1 Airpoint for every $2.00 spend $1000 = 500 Airpoints

Airpoints converted to Airpoints Dollars

(500 Airpoints „i 75)

= A 6.67

From 16 November Earning rate will be 1 Airpoints Dollar for every $150 spent (1000 „i 150)

$1000 = A 6.67

Gold GlobalPlus Visa/Gold GlobalPlus MasterCard Earning Rate

Today Earning rate is 1 Airpoint for every $1.50 spend $1000 = 667 Airpoints

Airpoints converted to Airpoints Dollars

(667 Airpoints „i 75)

= A 8.89

From

16 November Earning rate will be 1 Airpoints Dollar for every $100 spent (1000 „i 100)

$1000 = A 10.00

GlobalPlus American Express Card Double Earning Rate until 31 March 2005 **

Today Double earning rate is 1 Airpoint for every $1.00 spend $1000 = 1000 Airpoints

Airpoints converted to Airpoints Dollars

(1000 Airpoints „i 75)

= A 13.33

From

16 November to 31 March 2005 Double earning rate will be 2 Airpoints Dollars for every $150 spent (1000 „i 150) x 2

$1000 = A 13.33

Gold GlobalPlus American Express Card Earning Rate until 31 March 2005 **

Today Double earning rate is 2 Airpoints for every $1.50 spend $1000 = 1334 Airpoints

Airpoints converted to Airpoints Dollars

(1334 Airpoints „i 75)

= A 17.79

From

16 November to 31 March 2005 Double earning rate will be 2 Airpoint Dollars for every $100 spent (1000 „i 100) x 2

$1000 = A 20.00

- Home loans: the earning rate for GlobalPlus home loans, from 16 November 2004, will be $1,000 outstanding mortgage per annum = 1 Airpoints Dollar. There are no longer separate earning rates for variable-rate and fixed-rate home loans; a single earning rate applies from 16 November. Also, the 10,000 bonus Airpoints, offered on drawing a loan, will no longer be available.

- Insurance: existing GlobalPlus customers, who are LoanCare or LifeCare policyholders, will continue to earn rewards. The earning rate for existing insurance customers, from 16 November, will be $100 of premium = 1 Airpoints Dollar. New insurance customers will not be eligible for Airpoints Dollars from GlobalPlus from 16 November.

- Existing balances: On 16 November, existing Airpoints balances held by

Air New Zealand Airpoints customers will be converted to Airpoints Dollars

at the rate of 75 Airpoints = 1 Airpoints Dollar for New Zealand residents.

So, for example, a customer with 100,000 Airpoints will have 1,333.33

Airpoints Dollars. Where Air New Zealand deems the Airpoints customer to

be resident in Australia, the conversion rate will be 84 Airpoints = 1

Airpoints Dollar.

Legal notes:

GlobalPlus normal lending criteria apply. Air New Zealand Airpoints Programme terms and conditions apply. A $50 Airpoints joining fee may apply. Earning and redemption rates are subject to change without notice. Bank of New Zealand (and its related companies) do not guarantee the redemption of Airpoint Dollars or that Airpoints Dollars will continue to be offered for products or services provided by them. Where Air New Zealand deems customers to be resident in Australia, the earning rate may differ due to currency conversion. For GlobalPlus home loans an establishment fee of up to $250 applies and lender's mortgage insurance may apply. Airpoints Dollars cannot be used to pay taxes, levies or other surcharges related to your travel.

ENDS

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