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The only New Zealand bank that shares its profits with its customers is giving back even more money this year.
For the second year in a row The Co-operative Bank will pay a share of its profits directly to its customers.
As a result, on 1 July 2014, the majority of customers will receive a portion of a total $1.3 million rebate payment, Chief Executive Bruce McLachlan announced. This is an increase from the $1 million in rebates paid out last year.
"As a co-operative, our customers are our owners and shareholders, this is why we pay a rebate.
"It has been a good 12 months at The Co-operative Bank. I’m proud to say that, following the Bank’s second full year as a registered bank, we are looking stronger than ever with more than 10,000 new customers joining the Bank last year.
"Alongside our newest customers we have some amazingly loyal and longstanding customers and the rebates are a great way for us to show everyone that we continue to appreciate their support in banking with us."
$1.3 million is being shared around New Zealand with the Wellington region taking the largest share. Eligible customers from Porirua to Upper Hutt and central Wellington will receive a total of almost quarter of a million dollars.
"The values and ideas driving The Co-operative Bank are the same today as they always were. We are and have always been built on the idea of giving back. Rebates are just one more way The Bank is sharing and growing prosperity.
"For most of our customers the rebate will be between $7 and $100. It’s not a huge amount but we know that our customers would rather see a small slice in their own pocket than see profits sent to anonymous shareholders overseas."
The rest of The Bank’s profit is reinvested to fund further growth and to improve and develop products and services for customers.
"In the past year we took home the CANSTAR Blue award for Most Satisfied Customers. We are particularly proud of this achievement because it demonstrated that the pride we take in our work, our investment in infrastructure and staff is not only noticed but appreciated by our customers."
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The Co-operative Bank has experienced a sound year of growth in its second full year as a registered bank.
Annual results show the net profit after tax and rebates in the year ended 31 March 2014 was $7.1 million (up from $5.7 million the previous year). This is an increase of 24%, and was underpinned by a 37% fall in bad debts.
As well as having over 10,000 new customers joining the Bank, deposits grew 7.9% compared to a year earlier to $1.4 billion.
Chief Executive, Bruce McLachlan said the bank has taken some big strides in the past year, adding new branches in Auckland and Christchurch, relocating branches in Tauranga, Hastings, Wanganui and Dunedin, growing overall customer numbers and lending, and a strong increase in brand awareness.
Mr McLachlan said that low equity lending restrictions introduced in the past year have had no impact on the Bank’s momentum, with lending growth at an annualised 14% increase in the second half of the year and 9.7% for the whole year.
This year The Co-operative Bank will pay $1.3 million in rebates back to its customers compared to $1 million last year.
"This year’s rebate is one more way the Bank is sharing and growing prosperity. The values and ideas driving The Co-operative Bank are the same today as they always were. Our Bank is built on the idea of giving back."
The Co-operative Bank also won the CANSTAR Blue award for the most satisfied customers from among six New Zealand banks.
"We have achieved a lot in a short space of time. We’re still focussed on long-term sustainable growth, with a goal of doubling the size of the business in five years.
"We will soon be releasing a mobile application and will continue to focus on building the digital side of the bank, offering customers a much better online experience to complement our exceptional personal service.
"The Bank continues to have capital and liquidity ratios at the high end of the industry which provides a sound basis for future sustainable growth."
Annual result highlights
Highlights from the past year include:
- More than 10,000 new customers joined the Bank
- 24% increase in profits to $7.1 million up from $5.7 million the previous financial year
- A 37% fall in bad debts
- Four branch relocations, and 3 new branches
- New Contact Centre and big investment in digital platforms
- Major brand launch
- Lending growth of 14% in second 6 months against system growth circa 5%
- NPBRT was $6.5m in the second half of the year vs. $3.7m in the first half
- Capital and liquidity ratios remain at the high end of the market
- Credit rating remains stable
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Over the period of 27-30 June all The Co-operative Bank members will receive a Directors voting pack which gives background information on rebates and the Annual General Meeting, which is to be held at the Sudima Hotel, Mangere, Auckland 25 July this year at 5.30pm
We would love to see you at the AGM, so please think about coming along. If you can’t make it, you can watch it live on the internet.
Members can submit questions they’d like addressed at the AGM to firstname.lastname@example.org up until Friday 19 July. Please note that not all questions can be answered at the AGM due to time constraints, but the Chairman of the Board is committed to answering all questions submitted, following the event.
We encourage you to vote for our Board of Directors. Each nominee has prepared a summary profile and has made a short video covering who they are and what they can offer as a Director of The Co-operative Bank.
You can vote by post or online, just go to our Home Page for the online links. Voting closes on 17 July 2013 at 5pm.
For more information on the rebates or AGM or if there is anything that you’d like to discuss, please contact us on 0800 554 554 or for information on voting phone 0800 666 556.
Copies of the 2013 Annual Report are now available. You can see the report on our website by clicking here. You can also obtain a copy of this by emailing email@example.com, by phoning 0800 554 554 or write to The Co-operative Bank, PO Box 54, Wellington 6140.
You may have seen in the news recently, that global credit rating agency Standard & Poor’s (S&P) has adjusted our rating outlook. We are one of eight financial institutions (including three banks) who have had their ratings outlook adjusted from “stable” to “negative”. This change is not related to our performance as a bank, but is due to a wider concern about New Zealand’s economy as a whole. This concern is already recognised, and is being addressed, by the Government and Reserve Bank.
Importantly, S&P has clearly re-affirmed our BBB- investment grade credit rating. This comes as no surprise to us because our capital, funding and liquidity significantly exceed Reserve Bank requirements. For us, and you as members, it’s ‘business as usual’.
The Co-operative Bank has reported a strong interest for its innovative four month 4.6 per cent term deposit offer for investments as low as $2,000.
Deposits Portfolio Manager Grant Pritchard said that the offer, for investments from $2,000 to $20,000, had proved popular with both new and existing customers.
"It's a very innovative offer and not only because it starts at such a very low rate of investment. Usually rates at this level are reserved for investors with high balances. Typically special term rates start with a minimum investment of $10,000," said Mr Pritchard.
"Offers of this kind in the market can be limited to new customers. However, in keeping with our values and commitment to act in the best interests of our customers, we've also made it available to our existing customers because that's the co-operative thing to do."
Mr Pritchard said that the offer, which is for a limited period, is being reviewed on a weekly basis.
"It's had a very strong and steady uptake. Typically people with $2,000 would be putting it into a savings account, but we're achieving our aim of enabling more New Zealanders to get a higher rate of return on their savings," he said.
Bank Term Deposits are a secure, low-risk investment option which allows you to place funds in an account where the interest rate is set for a fixed period of time.
The Co-operative Bank is owned by its customers, with all profits staying in New Zealand. It provides a full range of everyday personal banking services including transaction accounts, savings accounts, personal loans and accounts for children, and Internet, Mobile, TXT and telephone banking. It also has overdrafts, insurance and investment options and a wide range of products and services designed to help small businesses.
The Co-operative Bank chairman Steven Fyfe announced today the appointment of Bruce McLachlan as the new CEO of the bank.
"We're delighted to appoint Bruce McLachlan. With Bruce we have both a very experienced New Zealand banker and someone with the right qualities to lead The Co-operative Bank to become a growing force in the New Zealand retail banking market," says Mr Fyfe.
Mr McLachlan has led both business and personal banking teams at a senior level during his banking career. His appointment is subject to approval from the Reserve Bank of New Zealand.
"Appointing Bruce as CEO concludes a momentous year for us and means that The Co-operative Bank has all the necessary foundations in place," says Mr Fyfe.
"In the past year we've achieved our banking licence, received a credit rating upgrade, changed our name and won the inaugural 2011 CANSTAR Blue Customer Satisfaction award for banking, receiving the maximum 5 stars in every category."
Gareth Fleming, the Acting CEO for the past four months, will return to his role as General Manager – Marketing and Products.
"The Board acknowledges with appreciation Gareth's commitment and performance during this period."
Mr Fyfe says The Co-operative Bank's 2012 year-end results, released today, were also in line with expectations.
The bank's underlying profit before tax was $7.2 million, compared with $7.4 million in 2010/11.
"Although the bank's pre-tax operating profit of $6.6 million is down on the previous year, we're pleased with the result, as the reduction in profit is primarily due to the one-off costs associated with bank registration and re-branding as The Co-operative Bank," says Mr Fyfe.
Deposits increased by 4% and were up by $51 million to $1.21 billion and lending increased by $43 million bringing total lending to $1.21 billion. Total reserves were up by $5.5 million on last year to $129 million. Capital Adequacy increased to 17.5% and is well in excess of the regulatory minimum of 8%.
Mr Fyfe says he is confident about The Co-operative Bank's future.
"The Co-operative Bank offers a genuine choice for customers as both a New Zealand and member-owned bank and our goal is to share our award winning banking experiences with more and more New Zealanders."
|Key end-of-year results for 31 March 2012 were:|
|Operating Profit (pre-tax)||$6.6 million|
|Underlying Profit (pre-tax)||$7.2 million|
|Capital Adequacy Ratio||Increased to 17.5%|
|Total Reserves||Up by $5.6 million to $129 million|
|Deposits||Up $51 million to $1.21 billion|
|Loans||Up $43 million to $1.21 billion|
We are pleased to announce that A.M. Best has today provided Co-operative Life limited, a wholly owned subsidiary of The Co-operative Bank, with a financial strength rating of B++ (Outlook: Stable).
Co-operative Life Limited underwrites the Life Plus, Life Care, Loan Plus, and Loan Care products which are distributed exclusively through the Bank's membership base and branch network across the country.
The rating is one notch below Best's 'excellent' rating category of A- and reflects the company's consistent profitability and sound levels of capital in relation to its underwriting risk. The business has grown its capital at an average rate of 37% for each of the last five years.
The Co-operative Bank has lowered its 6-month, 1, 2, 3 & 4 year fixed rates by up to 0.40%, effective from 2 November 2011.
Chief executive Dr Girol Karacaoglu, said The Co-operative Bank seeks to price itself competitively on a consistent basis, since it's a 100% customer-owned co-operative that exists purely for the benefit of its customers.
"Today's pricing move also reinforces our commitment to our customers, that although we've become a bank and changed our name, we're still the same place, with the same values and the same philosophies that we've had for the last 83 years."
Competitive pricing is one of the many benefits of banking with a co-operative.
"Over the next six months we'll also be introducing a number of new benefits for members, including paying a small rebate to members who do most of their banking with us. The introduction of rebates will not affect the consistency or competitiveness of our pricing strategy," said Dr Karacaoglu.
The Co-operative Bank from tomorrow will also lower some of its longer term deposit interest rates by between 0.05% and 0.20%.
Effective from today - Oct 26 2011, PSIS has been granted registration as a registered bank from the Reserve Bank of New Zealand.
The new bank, 100 percent owned by its customers, will fittingly be called: "The Co-operative Bank" and will specialise in personal banking.
PSIS chairman Sir David Gascoigne said the decision to pursue bank registration was one that was not made lightly.
"The Board concluded that our sound financial position, size and asset-base would be better served by the regulatory regime that surrounds the trading banks. Bank registration is also about better clarifying our position in the market. It means we can officially call ourselves a bank, so everyone will understand what we do without having to explain it."
"Our main focus has been the protection of our customers' rights and privileges. Securing bank registration will not alter the way we operate, or our commitment to our customers. We'll continue to operate the business on a sound and prudent basis. And we're extremely proud of the fact that we'll remain a co-operative and retain the essence of PSIS."
"Our excellent personal service, and the fact our customers' best interests are truly our number one priority, are just some of the key reasons our customer satisfaction is 96%."
"One change that our customers will notice from today is that our name will be different, as we'll be called "The Co-operative Bank." This name better reflects our distinct difference from other banks - the fact that we're actually a customer-owned co-operative. It also moves us strongly away from a long-held misconception that we do business only with public servants. In fact, we've been open to all New Zealanders since 1995."
"In true co-operative style, our staff, along with a number of our customers, were involved in developing the name, logo and tagline of our new bank," Sir David said.
PSIS CEO, Dr Girol Karacaoglu said the co-operative model is hugely successful worldwide and this has been particularly so during the recent global economic crisis.
"At a time when investors' faith has been shaken throughout the world, co-operatives have not only survived but thrived. People have been attracted and remained loyal to the conservative governance and risk management that's part of the co-operative ethos. We exist solely for the benefit of our members, and their best interests are our number one priority."
"Becoming a member-owned bank ensures our relationship with our members remains unchanged and we're not distracted by the need to satisfy shareholder returns. We'll be a bank driven by the values and heart of a co-operative," Dr Karacaoglu said.
"Over the next 12 months we'll be implementing a number of initiatives that will further demonstrate our co-operative difference. We want to give our customers a better voice so they can have a say in how we do things and we aim to pay our co-operative customers, who are our owners, a rebate based on the level of business they do with us."
The new name will be rolled out across the PSIS Branch network over the next few weeks, starting today.
"It's taken a lot of people a tremendous amount of hard work, commitment and dedication to make PSIS the success it has been for its first 83 years and we're committed to ensuring The Co-operative Bank will forge a similar success over the next 83 years," Dr Karacaoglu said.
Two new directors - Steven Fyfe and Ross Wilson have also been appointed to The Co-operative Bank board today with effect from tomorrow.
"Both new directors bring to The Co-operative Bank a wide range of skills and an engagement with the community, business, and banking sectors that will add enormous value to the board's deliberations," said Sir David.
Mr Fyfe has recently retired from the ANZ National Bank group where he has worked for 29-years. He was a Director and Chief Financial Officer for The National Bank from 1997-2004, and more recently he was Deputy CEO of ANZ National from 2009-2011.
Mr Wilson is a solicitor and mediator who has worked in a range of roles within various trade unions since 1979, culminating in his role as President of the New Zealand Council of Trade Unions from 1999-2007. Mr Wilson has served on a number of Boards including as Chair of the Accident Compensation Corporation and as a Director of Kiwi Rail Holdings Limited.
"We're delighted to have attracted two new Board Members of this calibre to The Co-operative Bank Board," said Sir David.
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An Investment Statement and the current Disclosure Statement are available from any branch of The Co-operative Bank or can be downloaded here.
Interest rates and fees are subject to change. For all lending products, The Co-operative Bank lending and insurance criteria, and fees, apply.
If a home loan is greater than 80% of the property's value, a low equity interest rate premium will apply and the revolving credit home loan will not be available.