Bendigo and Adelaide Bank focuses on digital offerings

Non-major bank Bendigo and Adelaide Bank has stated it will look to focus on its digital transformation program, while still acknowledging the importance of physical banks, particularly in regional areas.

At the lender’s annual general meeting (AGM) yesterday (24 October), CEO and managing director Marnie Baker confirmed that it would focus on launching new digital product offerings as part of its transformation process.

Ms Baker said in the 2023 financial year the bank had launched "new digital product offerings including term deposits online, reducing the number of core banking systems from seven to four, and reducing the number of IT applications by 90 as well as moving one-third of them to the cloud”.

She added: “As of the second half of 2023 financial year, 12 per cent of the bank’s home loan settlements are now fulfilled through digital channels.

“We are excited about the possibilities our investments in digital products have created for us.”

In her address at the AGM, Ms Baker also stated that while the group would strive to grow digitally, it recognised the concern regarding the growing volume of scam and fraud activity.

She stated that the bank was “working hard to reduce instances of scams and fraud, revealing that in the financial year 2023, it stopped $38.6 million in fraudulent transactions.

“As part of our ongoing and consistent focus on protecting our customers, the bank has tightened transaction rules, removed hyperlinks from our SMS messages and doubled the size of our financial crimes team,” she said.

“We continue to work hard to educate our customers about how to stay safe online and proactively detect and prevent the unauthorised use of customer accounts, including face-to-face education sessions at 430 locations across Australia.”

As part of the bank’s cyber security approach, Ms Baker said it was strongly advocating a “whole of ecosystem approach to combating scams and fraud”, which included educating customers on the role they play in keeping their information secure.

However, when taking questions from shareholders at the AGM, Bendigo and Adelaide Bank chair Jacqueline Hey stated that if a cyber attack occurs on the bank and accesses their consumers’ money, “the bank, wherever we are at fault, will reimburse customers”.

Ms Hey added that the bank would continue to cooperate with government and regulators to improve and prevent cyber crimes from occurring, while pointing to the example of the bank placing blocks on high-risk cryptocurrency transactions, to create friction to a possible scam avenue.

Physical branches remain important despite the digital future

Despite being “excited about the possibilities our investments in digital products have created”, Ms Baker said the bank was still aware of the prominence its physical branches had.

She stated: “We understand however that whilst we house workloads in the cloud, we ourselves don’t live in the cloud, we live in physical communities.

“Our physical network is very important to us, and we value the personalised interactions we have with our customers every day.”

However, Ms Baker added: “Customer preferences are changing, and we need to be responsive. We expect customer interest in our digital mortgage products to continue to grow as customers embrace their convenience and utility, and we will continue to work hard on our transformation agenda and to realise the benefits of further reducing complexity in our operations.”

When asked if the lender had plans to close any physical branches after the Australian Prudential Regulation Authority (APRA) last week revealed more than 400 bank branches closed in the 2023 financial year, Ms Hey said “closing a branch is a very much a last resort”.

She added that Bendigo and Adelaide Bank’s branch network was “crucial” and that the bank operated “more branches per customer than any of the majors”.

[Related: Bendigo and Adelaide Bank appoints a new chair]