anz shareholder strategy update specialisation, etransformation and growth
DESCRIPTION
ANZ Shareholder Strategy Update Specialisation, eTransformation and Growth. John McFarlane Chief Executive Officer Brisbane 18 August 2000. ANZ has now built a solid foundation. Competitive cost structure – cost to income ratio at low 50s - PowerPoint PPT PresentationTRANSCRIPT
ANZ Shareholder Strategy Update
Specialisation, eTransformation and Growth
John McFarlaneChief Executive Officer
Brisbane18 August 2000
ANZ has now built a solid foundation
• Competitive cost structure – cost to income ratio at low 50s
• Demonstrated ability to make bold portfolio moves (Grindlays sold, ANZIB reconfigured, retail stockbroking sold)
• Demonstrated ability to execute fast against important imperatives (cost & risk positions transformed over 2 years)
• Most businesses displaying strong underlying momentum
• High calibre, committed, dynamic management team
Group strategic direction built on specialisation, eTransformation and growth
Proposition
1 Integrated financial services firms will lose to specialists over time
2 The rise of specialists and new technologies will deliver superior customer value and erode margins
3 For ANZ more value will be created through focus and leverage of intangible assets than traditional concentration plays
Strategy
1 Reconceive and develop ANZ as a portfolio of specialist businesses
2 Become an “eBank with a human face”
3 Create a portfolio of high growth businesses which leverage capabilities and brands
Globalisation
Internet
Oldeconomy
Globalnew
economy
We are experiencing very profound change
Technology is driving costs down
Elapsed time for 100kb transfer Cost of a 3-minute telephone call from New York to London
Index, 1980=100
0.1
1
10
100
1980 1985 1990 1995 2000 2005
0
50
100
150
200
250
300
1930 1940 1950 1960 1970 1980 1990 2000
1996, $
A disaggregated approach is required
HousePurchase
Product Manufacturing
Sales &Marketing
CreditCard
WealthMgmt
CashDeposit
YodleeQuicken
EDSIBM
Distribution Channels& Processing
CustomerNeed
FidelitySchwab
CountrywideAHL
MBNANextCard
EggING
Many Australian institutions focused on consolidation stage
USA
EUROPE
AUSTRALIA
ASIA
leading to globalisation
consolidationFragmentation . . . to . . . and specialisation
Leading to globalisation
Strategy 1: Reconceive ANZ as portfolio of specialist businesses
• Make each of our 21 businesses a specialist in its own right
• Establish three new stand alone customer businesses - Wealth
Management, Small Business and General Banking
• Accelerate the growth of our strong product monoline businesses
• Move towards open architecture, selectively over time
• Manage the portfolio and brands actively from the centre
Contribution balanced between personal and corporate, and product and customer
International
PersonalCorporate
Other
0
100
Personal
Cards
Wealth Mgmt
Mortgages
Funds Mgmt
General Banking
Small Business
0
100
Corporate
Corporate
Foreign Exchange
Asset Finance
Capital Markets
Institutional
Structured Finance
Transaction Services
0 100AsiaPacific
%%
* Excluding Grindlays
738m*
37m*
368m 311m
International
CustomerBusinesses
Shaded
Share of Primary Relationshipswith Middle-Market Companies
0%
10%
20%
30%
ANZ NAB WBC CBA
ANZ: a leader in Corporate Banking#1 Best Bank in Australia US Global Finance Magazine 1999
6
6.5
7
7.5
8
8.5
1995 1996 1997 1998 1999
Source: Corporate Banking Roberts Research Group
Overall Satisfactionwith Bank
ANZNABCBAWBC
Share of Credit Card Spend
15
20
25
30
Jun-94 May-96 Apr-98 Mar-00
Momentum in Personal Financial Services
%
10
11
12
13
14
15
Jun-94 Jun-96 Jun-98
Mortgage Market Share%
Apr-00
Distribution model
“Make what we sell and sell what we make”
ANZ Manufactureie Mortgages
ANZ Distributionie Branches
Customers
Distribution models
“Make what we sell and sell what we make”
Open Architecture
ANZ Manufactureie Mortgages
ANZ Distributionie Branches
Customers
ANZ Manufactureie Mortgages
ANZ Distributionie Branches
Customers
OtherManufactures
Other Distributionie Mortgage Brokers
Group strategic direction built on specialisation, eTransformation and growth
Proposition
1 Integrated financial services firms will lose to specialists over time
2 The rise of specialists and new technologies will offer superior customer value and will erode margins
3 For ANZ more value will be created through focus and leverage of intangible assets than traditional concentration plays
Strategy
1 Reconceive and develop ANZ as a portfolio of specialist businesses
2 Become an “eBank with a human face”
3 Create a portfolio of high growth business which leverage capabilities and brands
-60%
-90%
Time required to find a high rate certificate of deposit
Minutes
Telephone
WWW
WWW + agent 1
10
25
Technology transforms what customers expect
Strategy 2 : the “eBank with a human face”
Better ServiceLower Costs
Automated, seamless Straight-through Processing
Single IP Network
Cus
tom
er
Man
agem
ent
Web enabled Channels Standard PlatformsCustomers
anz.com
0
50,000
100,000
150,000
200,000
250,000
300,000
Oct-99 Feb-00 Jun-00
Australia
New Zealand
Internet Banking Signups
10.28.9 8.9
7.9
5.1
ANZ WBC NAB St G CBA
Internet Banking Users% of Total Relationships
0
100
200
300 Index: 100 = average retail customer
Number of Products
Lending Balance
Deposit Balance
Profit Attrition
Internet Banking Customers
0
500
1000
1500
2000
Oct-99 Feb-00 Jun-00
Online Applications - Credit Cards
myanz.com
Proposition
1 Integrated financial services firms will lose to specialists over time
2 The rise of specialists and new technologies will offer superior customer value and will erode margins
3 For ANZ more value will be created through focus and leverage of intangible assets than traditional concentration plays
Strategy
1 Reconceive and develop ANZ as a portfolio of specialist businesses
2 Become an “eBank with a human face”
3 Create a portfolio of high growth business which leverage capabilities and brands
Group strategic direction built on specialisation, eTransformation and growth
Strategy 3: Create growth businesses
• Build from our strong corporate franchise by creating new businesses in corporate ePayments and eProcurement
• Strengthen our consumer proposition through building on our early eCommerce momentum, creating strong core offers and new businesses
• Extend our leadership in the Pacific by replicating our model in new countries
• Leverage our consumer and corporate eCommerce and Cards capabilities by partnering to build new businesses in Asia
• Build a small number of regional and/or global niches which leverage our capabilities
• Be very selective about acquisitions, considering only those which add strategically to individual businesses or enhance capabilities and create value
Web-enabling ANZ
Directors on lineDirectors on lineDirectors on lineDirectors on lineSales & Service Sales & Service
PlatformPlatform
ERPERP
ASTASTReal Time Real Time
Loan ApprovalsLoan Approvals
B2C
B2B
Internal
VIPS
ANZ in 3-5 years
• Leading positions in a number of specialist businesses in Australia, New Zealand and Asia
• Portfolio of businesses likely to be narrower and more focused
• A performance orientated driver of individual businesses
• Portfolio actively re-shaped by the corporate centre
• Multiple strategic alliances
• A range of growth businesses and options
• A leader in eCommerce
• Higher market to book ratio
Financial goals
• Earnings per share growth above peer average
• ROE above 20%
• Cost income ratio comfortably below 50%
• Inner Tier 1 capital approaching 6%
• Maintaining rating in AA category
For more informationvisit anz.com