Speaker 1: You're listening to A Shares these podcast.
Speaker 2: And so let's kind of turn our minds to open
Speaker 2: banking and neo banking. We've seen success in the UK
Speaker 2: and Australia where customers are able to be too more
Speaker 2: easily switch banks or be offered more competitive services and
Speaker 2: products from third party financial companies. But how has A
Speaker 2: and Z approached adopting open banking and tech in Australia
Speaker 2: and will we be taking the same approach here in
Speaker 2: New Zealand.
Speaker 1: So actually, the neo banking thing has largely been a
Speaker 1: failure and I think we should just call it as
Speaker 1: it is. I mean, most of the neo banks who
Speaker 1: started here in Australia have subsequently closed or been a
Speaker 1: quiet yeah. And the reason for that, and again on
Speaker 1: being overly critical probably and overly a bit unfair, is
Speaker 1: because they didn't there's nothing neo about what they're offering
Speaker 1: was to a customer, there was nothing new. They still
Speaker 1: took deposits and made light and you know large Okay,
Speaker 1: the act was a bit sexier, and you know there
Speaker 1: were some nice features around it, but the fundamental proposition
Speaker 1: was the same.
Speaker 3: Right.
Speaker 1: In fact, you could argue it was worse because they
Speaker 1: didn't have the breadth of service as a big bank had,
Speaker 1: and really importantly, they didn't have the stability that a
Speaker 1: big bank hats. Yeah in terms of the credit quality
Speaker 1: and the diversification benefits that we had. So I and
Speaker 1: that doesn't mean we should ignore technology. But where the
Speaker 1: really profound change hasn't been neo banking per se, has
Speaker 1: been real innovation, which is truly new proposition. So whether
Speaker 1: it's a revolute or wise or the way that or
Speaker 1: bone now po later on those sorts of things, so
Speaker 1: different ways of engaging with your financials, right, those are
Speaker 1: really where the innovation has come. Now. The challenges on
Speaker 1: a big bank is how do you engineer yourself to
Speaker 1: have the best of both big, stable, diverse and innovative,
Speaker 1: fast clever propositions. Well that's our strategy. That's why with
Speaker 1: launched d A m Z plus our new retail platform, which
Speaker 1: is we've got roundups too. But we're the only major
Speaker 1: bank who can do it because we've built ourselves in
Speaker 1: a modern, contemporary stack. Now, everybody criticized us for doing
Speaker 1: it because a cost a gazillion dollars, cost a lot
Speaker 1: of money to do, but once you get there, what
Speaker 1: we're seeing today's the advantage. We're only two years in market.
Speaker 1: The cost to service a customer on Plus is thirty
Speaker 1: five percent lower than it is in our traditional bank now.
Speaker 1: A year ago it was twenty percent lower. So it's
Speaker 1: getting the gaps widening. So that's our future. I think
Speaker 1: the future is all about how do we embrace new technology,
Speaker 1: So we use open banking and Plus. Using open banking,
Speaker 1: you can go in and you can import your balances
Speaker 1: and transactions to view them from one hundred and ten
Speaker 1: other banks in Australia, any of them, and see it
Speaker 1: all and see your consolidated financials. That's really really cool.
Speaker 1: Now we're the only major bank that does that as well,
Speaker 1: because we've invested in the technology stack that allows it.
Speaker 2: I read someth with it. About seven percent of the
Speaker 2: A and Z code written last year was generated by AI.
Speaker 2: I think it's hub copilot. Can you tell us a
Speaker 2: bit about how you envision AI technology changed it the
Speaker 2: operational nature of A and Z and also the banking
Speaker 2: industry as a whole.
Speaker 1: I spent a bit of time up in California recently,
Speaker 1: and the future is as generative AI and I know
Speaker 1: probably people are sick of hearing about it, and there's
Speaker 1: no doubt there's an element of overhype. That's true in
Speaker 1: any new technology. But I've seen that future, and the
Speaker 1: future is going to come in two ways. All of
Speaker 1: the banks, we'll all everybody will start using these co
Speaker 1: pilots that are embedded in every single tech tool we have,
Speaker 1: Microsoft Outlook, it will be in Salesforce, it will be
Speaker 1: into every tech tool we have your phone, and they'll
Speaker 1: be great, and they'll make us all more efficient, just
Speaker 1: like email made us all more efficient. But the benefits
Speaker 1: of that won't differentiate you. They'll all get competed away
Speaker 1: for the benefit of customers, but you still have to
Speaker 1: do it great. The real opportunity is how do you
Speaker 1: then take those AI tools and intelligent automation that comes
Speaker 1: with it advanced analytics and embed those in propositions. Yeah,
Speaker 1: so imagine if on your an SID plus you had
Speaker 1: a virtual personal banker who you can ask questions of.
Speaker 1: Am I going to be able to for to go
Speaker 1: on holiday this year? Tell me where my money went
Speaker 1: last month? Talk to me about am I saving enough
Speaker 1: to form my retirement? All the banks will do the
Speaker 1: productivity stuff, contact centers, all that some who have the
Speaker 1: right tech platforms, we're able to build better propositions and
Speaker 1: that's obviously where we aspire to be. In Australia and
Speaker 1: in New Zealand.
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