Speech Notes: Opening of Nelson Kiwibank Franchise
Opening of Nelson Kiwibank Franchise
Nelson Kiwibank Franchise Milton Street Store in The Wood
I am very proud to open a new branch of Kiwibank
We are creating an asset for New Zealanders.
It’s not that long ago that political opponents of the bank said it couldn’t succeed.
But it is performing even better than the business case that New Zealand Post put to the government.
The biggest query over the case for Kiwibank was the question of whether new customers would join the bank in the numbers that were predicted.
In fact, New Zealanders are joining faster.
This week, the bank passed 60,000 customers – more than ten per cent ahead of the business case for the bank.
I checked the rate that people are joining.
This month alone, up to Monday, the lowest number that joined the bank on any given day was 464, and the highest was 580 new customers on a single day.
The total deposits with the bank are ahead of the predictions.
Growth has doubled in the last three months.
Critics of the bank sneered that it would be a ‘poor people’s bank.’
I personally don’t have a problem with a financial institution that is interested in all New Zealanders.
But new customers are being drawn from all income and social sectors.
Customers are being attracted by new products like children’s accounts and email statements.
PayStream will automatically split your pay by set amounts or percentages into your chosen Kiwibank accounts. This saves you having to set up automatic transfers or doing manual transfers every month.
Sweep accounts automatically ensure your money is always earning maximum interest. Money is automatically transferred from other accounts when you make an ATM or eft-pos withdrawal. So you don’t get embarrassed because one account is empty when there is plenty available in another account.
Home loans are cheaper than loans offered by the overseas owned banks, and Kiwibank is guaranteeing that it offer lower interest rates for the next six years.
A 1% rise in interest rates adds about $52 per month to the expenses of an average $100,000 mortgage.
Kiwibank has been offering interest rates that are consistently half a per cent lower than those of the other banks.
The editor of the online money magazine Good Returns has written that the overseas banks are being ‘greedy.’
Kiwibank’s interest rates would save a household with an average mortgage up to $1000.
Remember that every dollar a household saves by banking with a New Zealand owned institution is a dollar that isn’t going into the profits of the overseas banks.
It is money that keeps going around in the New Zealand economy, supporting local businesses.
The former Governor of the Reserve Bank is going around saying that the problem with the bank is that depositors don’t have a government guarantee.
That is an outrageous statement for a former Governor to make.
Depositors have the same protection at Kiwibank as they have at any other bank.
The bank has a very solid AA- credit rating.
It is backed by the financial security of New Zealand Post.
And it is performing successfully.
The time has come for the critics of Kiwibank to stop knocking a New Zealand success story.
The only reason they attack the bank is to try to score political points.
What kind of politician tries to destroy a public asset that is offering a service to New Zealanders?
Their criticisms have failed, and they should apologise.
New Zealand needs to do better at celebrating our success stories.
We need to become less tolerant of professional critics.
As Minister of Economic Development I see positive developmental ideas being knocked all the time.
We need to do better at embracing the spirit of ‘give it a go.’
We’re all used to celebrating success on the sports field.
But New Zealand has world class performers in the arts, world class academics, and world class achievers in business and innovation.
We need to do better at hailing the success of all of them.
I believe Kiwibank is joining the ranks of great New Zealand success stories.
When the government made the decision to allow NZ Post to go ahead with starting a publicly-owned New Zealand bank, the promise was:
Kiwibank would have lower fees.
Kiwibank would have more branches than any other bank.
Kiwibank would benefit customers of other banks by keeping them honest, producing lower fees and interest rates at all banks.
Kiwibank has delivered on all of these promises.
It was always forecast that Kiwibank would become profitable in three years.
The bank remains on target to meet that aim.
Kiwibank is already keeping the other banks honest.
Why else would Westpac be offering a 15c eft-pos fee?
Why would the ANZ be running advertisements saying it has changed its attitude?
According to the Consumers Institute chief executive David Russell, ‘Kiwibank, with its low fees and simple accounts, is forcing the big banks to review their offerings.”
By using its franchise network, Kiwibank already has the largest network of branches of any bank in New Zealand.
It is moving back into a number of areas which had lost their banking services over recent years. This includes Featherston and Greytown in the Wairarapa, Kawakawa in the Far North and Darfield in Canterbury.
Kiwibank will also be the only bank in more than 30 suburban areas of towns and cities across the country.
After a decade and a half of relentless branch closures by the overseas banks, Kiwibank has been opening branches at the rate of up to twenty a week.
Kiwibank has been established to meet the banking needs of retail consumers.
But small businesses are paying high bank fees too.
At the moment, Kiwibank is not offering a service for small businesses, although it does accept banking business from sole traders and community groups.
Kiwibank needs time to roll out its remaining branches.
After that, I would like to see its services expanded to include small businesses.
There are close to a quarter of a million small businesses in New Zealand.
I would rather that they spent their cash on growing their businesses than expanding the profits of the Australian banks through excessive fees and businesses lending rates.
No other developed country in the world allows as much of its banking system to be overseas owned as we do.
It’s time to say ‘if they can do it, so can we.’
We can have our own bank.
I believe that Kiwibank has a very positive future.
It is proving successful, and customers in communities around New Zealand are welcoming it with their business.
I believe this new franchise branch will be another example of the success we can expect for the bank.
I wish you all the best in meeting the needs of your local community.