Image Source: Getty Images
shares of Australia and New Zealand Banking Group Limited (ASX: ANZ) is in the spotlight as the big ASX bank stock tries to catch up with its rivals.
The bank has committed to transforming its operations by using technology to improve customer service and accelerate change.
As reported by ageANZ’s market share in residential declined by more than 100 basis points (or 1%) in the year to 31 July 2022, according to Macquarie Research and APRA.
Bank management has been looking at ways to regain momentum and return the bank to underlying growth.
Commitment to technology
ANZ Chairman Paul O’Sullivan, who has held the position since October 2020, said: Australian Financial Review):
We are transforming to ensure banks lead the next phase. And there’s no shame in telling staff that they should aspire to lead what we do.
This means having very modern technology capabilities in-house that reflect the speed at which society wants to engage and reduce friction. We need a really deep understanding of the financial well-being needs of our communities and how to meet them.
They also need to be socially responsible and responsive to community issues. So we’ll get it right and then set it up really well in the long run.
But while O’Sullivan admits that customers are disappointed with ANZ Plus, it’s the technological change behind the scenes that’s getting people inside ANZ excited.
Mr O’Sullivan said the current situation within ANZ was “like a home renovation where the back of the house was demolished and all your folks think it’s going to take forever.” But ANZ leaders believe it’s worth taking the time to get it right because it’s something ANZ may end up using over the next 20 to 30 years.
Banks could have spent money on an off-the-shelf platform, but ANZ wants to customize its services for its customers so they can do something ‘innovative’.
Mr O’Sullivan said:
I think it’s the right decision. It’s different than usual, so you’ll get a bit of artillery fire along the way. This will take some time. It’s getting more complicated. But I think once that’s done, going back to transformation, we’ll be in a very strong position to be able to do something different and innovative with our customers.
Some brokers have suggested that ANZ is buying its banking division. Suncorp Group Limited (ASX: SUN) is trying to regain some of its lost market share.
However, O’Sullivan acknowledged that while the acquisition would increase ANZ’s exposure to households and increase its exposure to Queensland, it would not just expand for no reason. He believes it’s the right thing to do for the long-term interests of the business.
Recent Broker Rating
One of the latest brokers to give an opinion on ANZ is Macquarie, which has a price target of $24 on ANZ and a buy rating on ANZ. This means that it will rise slightly over the next year.
Banks believe they can benefit from higher central bank rates and a modest rise in savers.