Transcript No Slide Title

David Murray
Full Year Results - August 2001
www.commbank.com.au
Disclaimer
The material that follows is a presentation of
general background information about the Bank’s
activities current at the date of the presentation,
22 August 2001. It is information given in
summary form and does not purport to be
complete. It is not intended to be relied upon as
advice to investors or potential investors and
does not take into account the investment
objectives, financial situation or needs of any
particular investor. These should be considered,
with or without professional advice when
deciding if an investment is appropriate.
2
Speaker’s Notes
• Speaker’s notes for this presentation
are attached below each slide.
• To access them, you may need to
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view/print in “notes view.”
3
Agenda
• Progress report
• Strategic focus and implementation
• Outcome
4
Group Goals
Strategic Vision
To be the best brand in helping
customers manage and build wealth
Drivers
Customer Service
Financial Goal
Top
Quartil
e TSR
Business Goals
Attract more customers
& more revenue per customer
Brand
Business Mix
Best value service through
innovation & on-line leadership
Competitive Scale
Risk Management
Best Team
Management Quality
Develop offshore
opportunities
Global best-practice costs
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The Integration Achievement
People
Phase
• Interim Risk
management
framework
Design
Phase
• Product Decisions
• Brand Strategies
• Staff & Customer
Communications
• Owned
Distribution
• Email link
•Third Party
Distribution
• Key management
roles
• Corporate entity
restructuring
• Managerial
Functions
Rationalisation
• On-line strategies
Specifications
Phase
• Product
Rationalisation
• Brand economics
analysed
• Systems changes
to support product
specification
• Back office
processing
specifications
• Interim process
integration
• Distribution
function
specifications
Implementation
Phase
• Colonial Customers
transact in CBA branches
• Brands rationalised
• Branch amalgamation
• Call Centre & Back
office integration
• Third party distribution
alignment
• On line business model
• Property rationalisation
• Systems integration
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Components of Shareholder Value
Year to 30 June 2001
Factor
Profile
Outcome
Credit Growth
Match market
Below system
Funds Under
Management Growth
Exceed market
Retail up 38%,
Wholesale up 7%
Deposit Growth*
Match Market
Domestic NIM not less than
market for comparable
business mix
Zero real cost increment
7% vs 12.8% system
2.97% Stable.
(Down 1bp)
Small
Up 24%
Optimise regulatory capital
and maintain rating.
T1
6.51%
Total 9.16%
Rating AABelow
Domestic Margin
Costs
Bad Debt Charge
Capital Management
Total Shareholder Return Top quartile**
Up 7%
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Strategic focus and
implementation
Starting position
Potential Product Use
INVESTMENT
SUPERANNUATION
AND INSURANCE
10 million
customers
BANKING
BANKING
Alignment of products to customer needs
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Customer Needs, Customised Products
and Solutions, Customised Service
10 million
customers
Potential
Product
Use
BANKING
INVESTMENT
SUPERANNUATION AND INSURANCE
BANKING
Life
Stages
Youth
Early
Career
Home
Owner
Wealth
Builder
Retirement
Planner
Retirees
Median Age of Australian Population over the next 40 years
28
30
32
35
38
40
42
44
1970
1980
1990
2000
2010
2020
2030
2040
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Plus: Challenging operating environment
• Uncertain economic outlook
• Threat of increased regulation
• Greater competition
• Declining margins
• Weakness in the currency
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Focus
Strategic Vision
Financial Goal
To be the best brand
in helping customers
manage and build wealth
Top
Quartil
e TSR
Drivers
Business Goals
Drivers
Provide customised service to
grow revenue
Customer Service
Brand
Business Mix
Develop the Best Team
Competitive Scale
Risk Management
Develop offshore
opportunities
Management Quality
Achieve global
best-practice costs
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Implementation
Strategic vision
Financial goal
To be the best brand
in helping customers
manage and build wealth
Top
quartil
e TSR
Drivers
Business goals
Provide customised service
to grow revenue
Areas of focus
Customisation
Distribution
• Wealth
Management
Third Party
Customer service
Brand
Business mix
Competitive scale
Risk management
Management quality
Develop the best team
• Services
aligned to
customers
needs
Develop offshore
opportunities
Achieve global
best-practice costs
International
Technology
• Productivity
Business Process
Re-engineering
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Customisation
Develop optimum product and channel mix
• Wealth Management
Understand
Customer Needs
• Services aligned to
customers needs
Transaction
Advice
Credit Card
Information
Lending
Investments
Insurance
ATM
Branch
Call Centre
Ezy Banking
• Productivity
Internet
Personal Banker
Financial Planning
Third Parties.
with systems that deliver
customised service.
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Distribution: Proprietary and Third party
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International



Operations in UK, New Zealand, Hong Kong, Singapore and China.
Focus on institutional, wholesale and retail markets.
Investment in most asset classes.
Location of FUM - by source
Asia
•
Aus
75%
United Kingdom
•
•
London &
Edinburgh
188 staff
•
Presence in Hong Kong,
Singapore & Mainland China
84 staff
Tactical Global
Management
•
•
UK
19%
Asia
3%
24 staff
Domestic &
International
clients
NZ
3%
Total FUM - A$ 77bn
New Zealand
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Technology and Process Re-engineering
• IPNet and Intranet
• eProcurement
• Web enabled HR and Financial information services
• Image item processing
• End to end process re-engineering
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Outcome
Customers
Service Quality Index
19%
19%
39%
5%
Initiative
25%
Jan-01
Jun-01
Accuracy
Presentation
Knowledge
Response
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People - Best Team
Leadership
Engagement
Service
Growth
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Plan to June 2006
Business Driver
Group
Profile
5 year Plan
Growth in Market Share
Funds under management
Home Loans
Credit Cards
Life Insurance
Credit Products
Business Financing
Retail Deposits
Margins
Comparable for business mix Continuing decline
Sources of Income
Comparable Financial
Institutions
Costs
Reduction in cost/income –
Best practice
Capital Management
Total Shareholder Return
Optimise regulatory capital
and maintain rating.
Top quartile
At or above market
Rebalance toward
non-interest income
3%-6% productivity
change
Rating AA
Deliver top quartile
TSR.
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David Murray
Full Year Results - August 2001
www.commbank.com.au