Technology transformation progressing alongside solid growth
31st October 2017
Technology transformation progressing alongside year of solid growth
NZCU Baywide provided an upbeat summary at its AGM last night in Havelock North, reporting ongoing progress with its core-banking system upgrade, a 6 per cent growth in assets to $312m and a healthy financial position with reserves of $39.9m.
Chief Executive Gavin Earle said the year to June 2017 has been one of investing in core infrastructure technology while balancing this commitment with good growth, solid profitability and exceptional customer service, including developing a new branch concept.
“Last year we set important goals to reflect the rapid changes we’re all experiencing from technology change and digital transformation, the most significant being the upgrade of our core banking system,” he said.
“It has been no mean feat to take an organisation of our size through this change and there’s been a huge effort by the team to focus on the pending implementation, while also maintaining our day-to-day service at the levels our customers expect. This has paid off with the new technology expected to go live in the very near future,” he said.
“While we’ve been progressing change, we have continued to deliver impressive results. Along with assets growing, loans to customers grew by 26 per cent to $267m and our credit rating was reaffirmed at BB by our ratings agency Fitch.
“Our strategic investment in the future, as well as tighter interest margins, did lead to a lower operating surplus of $1.2m, with borrowers and investors benefitting by approximately $1m more in interest than was projected. However, this has been offset by costs being very well contained overall,” he said.
Mr Earle indicated that the installation of the new core banking system opened up the next phase of business transformation including an enhanced loan processing, mobile app and internet banking system – “it will also secure our future and provide a foundation for other technology to enhance customer experience, innovation, speed of service and convenience,” he said.
He also pointed out that while technology has been a focus, the branch network is also in-line for an upgrade:
“Our branch network is an equal partner in our channel mix and plays a vital role in the heart of communities across the Central North Island.
“It is for this reason that during the year we have also developed our Branch 2.0 concept that will transform our branch experience and meet evolving customer needs. I’m delighted to say that before Christmas we will introduce this concept to Lower Hutt and Palmerston North, followed by our largest two sites in Hastings and Napier.
“Our year’s result shows a very credible and solid performance from helping everyday Kiwis achieve their financial goals by providing competitive first home buyer lending, personal lending and debt consolidation, and high interest saving and term deposits. We’ve achieved this while at the same time delivering change and staying very competitive in a challenging environment,” he said.
NZCU Baywide Chairman, Ian Taylor, supported Mr Earle’s summary of the year by emphasising the importance of investing in core infrastructures, and a diversified growth strategy including acquisition via brokers and online, to support a strong future.
“NZCU Baywide will shortly be the second Credit Union in New Zealand to transform to a world class core banking platform to position us to meet the demands of 21st Century banking. In true cooperative spirit, for the last year we have been working with a group of nine Credit Unions to replace our core banking system – Aotearoa Credit Union was first but is a lot smaller,” he said.
“This is an excellent result as the new platform gives us the ability to respond to rapid technological change in the market and be flexible enough to meet the evolving needs of our customers,” he said.
“We have also been buoyed by the level of support at a Government level with all political parties recognising the need to align Credit Unions more with other financial service providers, through a long-overdue review of the out-dated Friendly Societies and Credit Unions Act,” he said.
“Overall, the Board continues to plan for future success by maintaining a rolling long-term strategic focus on delivering value to customer owners, growing our business and profitability, and developing our people and infrastructure,” he said.
Mr Taylor concluded with a note of thanks to everyone at NZCU Baywide for their outstanding commitment, hard work and dedication throughout a period of significant workload and change, and to all customer owners for their ongoing support.
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