BoQ aims to be alternative
(15 December 2009 – Australia) Bank of Queensland’s managing director, David Liddy, told shareholders at the group’s annual general meeting that there is a façade of competition in the market and BoQ can fill the void in the industry, becoming a real alternative to the big four.
Mr Liddy said that he believes that Bank of Queensland is a stronger and more robust organisation than it was going in to the global financial crisis and is well-positioned to continue its growth trajectory.
The bank’s managing director also said that 15 years of intensifying competition from regional banks, building societies, credit unions, and non-bank financial institutions is now reversing.
Mr Liddy said that people could call him sceptical, but it appears that the regional bank brands that have been purchased are being maintained to create a façade of competition.
What this means however, is that there is a very clear void in the banking market - and therefore an opportunity for a real alternative to be created to be a genuine contender to the major banks; BoQ wants to take this space, Mr Liddy highlighted.
Mr Liddy also used the opportunity to again highlight the competition issues facing the Australian banking industry and the inequality of the Federal Government's wholesale funding guarantee, which costs more for smaller banks such as BoQ to access compared with major banks.
Under the current guarantee, the big four, which have a AA rating, pay an extra 70 basis points annually for bonds issued under the scheme.
However, smaller banks must pay up to 100 to 150 basis points extra; the Bank of Queensland pays the full 150 basis points due to its BBB credit rating.
The bank’s managing director also said that 15 years of intensifying competition from regional banks, building societies, credit unions, and non-bank financial institutions is now reversing.
Mr Liddy said that people could call him sceptical, but it appears that the regional bank brands that have been purchased are being maintained to create a façade of competition.
What this means however, is that there is a very clear void in the banking market - and therefore an opportunity for a real alternative to be created to be a genuine contender to the major banks; BoQ wants to take this space, Mr Liddy highlighted.
Mr Liddy also used the opportunity to again highlight the competition issues facing the Australian banking industry and the inequality of the Federal Government's wholesale funding guarantee, which costs more for smaller banks such as BoQ to access compared with major banks.
Under the current guarantee, the big four, which have a AA rating, pay an extra 70 basis points annually for bonds issued under the scheme.
However, smaller banks must pay up to 100 to 150 basis points extra; the Bank of Queensland pays the full 150 basis points due to its BBB credit rating.
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