Second People’s Choice Award for BNZ KiwiSaver

By BNZ Head of Wealth & Private Bank, Donna Nicolof

KiwiSaver should be a key part of New Zealanders’ retirement planning. Because of how vital it is, we have put a huge emphasis on making sure the BNZ KiwiSaver Scheme is as good as it can be. This approach was recently given the tick by our customers with ConsumerNZ awarding us their People’s Choice Award for the second year running. Continue reading “Second People’s Choice Award for BNZ KiwiSaver”

The generation game: financial wins for women at every age

New research into women’s attitudes towards money show different generations can learn from each other and no-one has the monopoly on being good with money.

The BNZ Financial Futures research also found grandmothers and granddaughters have more in common than they might think.

Women aged under 25 and over 65 are less likely than other women to believe that owning a home is a sign of financial success, with 48% considering it relevant, compared with 57% of other generations.

The youngest and oldest women also shared some behaviours around money, being more likely than other age groups to save for expensive non-essential items. This could be things like the latest mobile phone or tablet. But if they did borrow, they were less likely to pay off the loans with highest interest rates first.

Donna Nicolof, BNZ’s Head of Wealth and Private Bank, says: “The differences between younger and older women came out when we asked them more about their attitudes towards debt.

“Nearly a third of women under the age of 45 are accepting of a reasonable level of debt compared with only one in five of women over 45.

“That’s understandable, as people under the age of 45 have grown up with credit easily available – taking out student loans or using credit cards have become the norm. Whereas older people were brought up to live within their means.

“It was good to see the realisation among half of those women under 25, and nearly as many under 35s, who said they could save more if they cut down on some non-essential spending.

“That’s a question of prioritising spending such as eating out only for special occasions and entertaining at home. It’s worth putting even a small amount aside each week throughout your life to take advantage of the benefits of compounding interest over the long term,” Ms Nicolof says. 

More than half of women aged 25-64 regularly pay back more than the minimum on their debt, the survey showed.

“This is outstanding as saving and reducing debt are crucial strategies for financial wellbeing. People often ask me what to do if they receive a lump sum, from an inheritance for example, and I generally always say reduce your debt,” Ms Nicolof says.

While women in their mid-thirties to mid-fifties are the group most likely to struggle to save or pay their credit card in full each month, their attitude to saving and investing could help them.

Four out of ten women in their mid-thirties to mid-fifties thought it was good to take calculated risks with their money to grow the savings they do have, compared with three in ten of all other ages.

“A positive attitude towards risk helps in the long run because calculated risk can bring higher returns,” says Ms Nicolof. “We see this with KiwiSaver for example where people in growth funds are likely to have a higher return over the long term than those who invest in conservative funds.”

A study by US fund manager Ellevest, which specialises in investments for women, found female investors tend to benefit from being risk-aware. They often want to understand a risk thoroughly before they take it on, resulting in them accepting ‘smart’ risks which lead to long-term success.

The number of New Zealand women who own shares is relatively low, at 25% according to the Financial Futures research. But as they get older women are more likely to own a diverse range of investments, with the number rising from 18% of under 25s to 29% of over 55s.

“Diversification is the key to growing your wealth so it’s an important factor to pay attention to as you plan your financial future,” Ms Nicolof says.

The Financial Futures research also showed that women understand their finances better as they get older, with 95% of the over 65s having a deep understanding of their financial situation, compared with only 56% of the under 25s.

“There’s a good level of understanding for all women over 25. But one area where everyone under 65 could focus on more is working out how much money they will need for retirement – 75% don’t know. If you set yourself a goal, it’s much easier to work out what you need to do to get there,” says Ms Nicolof.

There are tools that can help with this, including the BNZ KiwiSaver calculator, which can show the impact your fund choice or contribution rate could have on your lifestyle in retirement.

Strong BNZ result supports bank’s commitment to deliver for customers

Bank of New Zealand’s (BNZ) half year financial results illustrate a strong performance for the bank and its customers, according to CEO Angie Mentis. “BNZ’s strong revenue growth has been underpinned by a significant growth in customer deposits and savings.”

BNZ has announced a statutory net profit for its banking group of $490 million for the six months ended 31 March 2018, with operating revenue up 11.1%.  Cash earnings for NZ Bankingincreased by 8.6% over the same period.

Revenue growth was supported by strong business and housing lending growth and improved net interest margin.

“These results mean BNZ is well placed to respond to an unprecedented change in the way customers are using digital technology. We are accelerating an ambitious transformation strategy. Our sights are set on the changes that will make the biggest difference to our ability to consistently offer our customers a seamless banking experience,” says Ms Mentis.

Over 92% of BNZ transactions and 49% of sales are now digital. “Having the right resources in the right places will continue to be an area of focus for us.  Our half year results include an allowance for costs to support the reshaping of the bank with our focus on becoming faster, more personal and innovating across our digital platforms,” says Ms Mentis.

Working hard to get things right

“BNZ is not complacent about the issues emerging from Australia. We will be ruthlessly vigilant in ensuring that our customers’ trust in us is well placed,” says Ms Mentis.

“In our focus to deliver a seamless banking experience, we assess global best practice in relation to conduct and are taking learnings from several recent financial sector inquiries across Australia, the UK and the US.” says Ms Mentis. “The Royal Commission is helping shape this work, but our focus is deliberately broader than that to ensure we are across all relevant findings and learnings.”

Backing New Zealand business and home owners

Since January Ms Mentis has talked to more than 200 BNZ business customers. “Our customers tell us the same things,” says Ms Mentis. “They want a bank that knows them, that is there to support them and a bank that is simple to do business with.”

With customer deposits now totaling $58 billion, BNZ is better placed than ever to support business growth right across the economy. Growth in the SME segment continues with lending to small and medium sized companies now totaling $22 billion.

“We’ve continued to support New Zealanders to get into their first or next home or property, with an increase of $2 billion in housing lending over the same period,” says Ms Mentis.

Bank of choice for wealth management

BNZ Private Bank has been awarded global recognition as the best Private Bank in New Zealand for five years in a row. For the second year in a row, the bank celebrated winning the Consumer NZ People’s Choice award for KiwiSaver overall satisfaction. BNZ is the only back to back winner of this award.

BNZ now has $5 billion in funds under management. BNZ is working hard to meet the wealth management needs of even more customers and is excited about the opportunity to do that by creating YouWealth, the bank’s newest wealth management offer,” says Ms Mentis.

Supporting New Zealand communities

“Making a difference in our customers’ lives and in the communities they share is what inspires most BNZers. That’s particularly reflected in our fantastic Community Finance scheme,” says Ms Mentis. 

Community Finance now has Vaka Tautua on its list of community providers, alongside the likes of Salvation Army. Vaka Tautua Chief Executive Vui Mark Gosche says “Pacific families are captive to the worst loan providers in New Zealand… being able to provide Community Finance loans means we are able to offer a fair option for families who are already in financial distress.”

Ms Mentis says “At BNZ we also recognise that for many New Zealanders moving to a digital financial world can be daunting. So, we’re sending 1,200 of BNZ’s tech savvy staff into our neighborhoods to help community groups like Senior Net help their members to be more comfortable in the digital world.”

“There’s so much more BNZ is doing with our communities and I ask everyone to read today’s results alongside BNZ’s Good Report. It highlights the role BNZ plays in our communities, from charitable work through to supporting diversity and inclusion.”

“I’m delighted to be part of a great organisation with such a long and proud history in our country,” says Ms Mentis. “These endeavours are great examples of how strong financial results, like those I’ve announced today, enable BNZ to support our customers, our communities and New Zealand.”