TB Canty confident

Press, 24 May 1988, Page 23

TB Canty confident

The general manager of Trust Bank Canterbury, Mr Frank Dickson, is confident Trust Bank Canterbury will retain full autonomy under the restructuring being considered for the country’s trustee (formerly savings) banks.

Under the Trustee Bank Restructuring Bill, the Trust Bank Group, of nine regional banks including Canterbury, will be constituted as companies under the Companies Act with the shares held by community trusts in each region. The Auckland Savings Bank, the ASB, has struck out on its own, and many eventually set up branches throughout the country. The nine other main trustee banks have formed Trust Bank Group. It has an umbrella company. Trustee Bank Holdings, to cut costs in fields such as marketing and data processing. Mr Dickson agreed that the Trust Bank Group may also compete with the ASB in Auckland.

Each bank in the group would remain a separate entity, said Mr Dickson, at a press briefing at the release yesterday of Trust Bank Canterbury’s report for the year

ended March 31. With deregulation, trust banks are moving into testing times, with the Government guarantee to be abolished and the reduction of the burden of compulsory heavy investment in Government and local-body stock, which for decades before Rogernomics was virtually a tax on savers.

In the emerging mortgage market, Trust Bank Canterbury will probably sell mortgages, Mr Dickson confirmed. Savers have always looked on savings (now trust) banks as kindly lenders, and may recoil if their mortgages are liable to be sold off to groups seen as hard-nosed capitalists with power to raise home interest rates. Mr Dickson concedes that these sensitivities exist, but says there are arrangements which may be suitable, such as where the trust bank managed the mortgages it sold. The president of Trust Bank Canterbury, Mr Mark Holdsworth, said that although the bank was now entitled to conduct commercial banking, it was moving into this area cautiously. “A conservative attitude had been adopted in approaching this sector.” “The challenge now is for Trust Bank Canterbury to continue to improve its mar-

Ret share, while at the same time ensuring profit levels are maintained.” Trust banks, like Postßank have traditionally been saddled with a very high proportion of low-amount transactions. It costs about as much to have staff process a $lO deposit as a mlllion-dollar deposit, and it has been said that trustee banks lose money every time they handle a transaction of less than $lO.

Technology is galloping to the rescue, with automatic teller machines, where all the labour cost is the customer’s.

Trust Bank Canterbury has 30 automated telling machiness, which process up to 350,000 transactions a month, and is planning to install several more. Ten "inbranch” machines handle up to 40,000 transactions a month. More of these will be installed soon.

At the end of April the bank had 199 EFT/PCS sites in the region and during that month they processed 55,000 transactions worth more than S2M.

The bank is planning an automated banking lobby in the Canterbury Centre branch, with access by card 24 hours a day. Services provided will include cash, statements, and information screens.