Bank customers on the move – willingness to switch banks increases

• The number of new customers gained by Erste Bank und Sparkassen in 2015 amounted to a remarkable 195,881 people
• According to a study by meinungsraum.at, on average 16 percent of bank customers plan to switch to a different credit institution – however, this applies only to 8% of Erste Bank's customers
• Erste Bank und Sparkassen remain on growth track

As a result of the economic environment the past financial year has been difficult. Low interest rates and a greater degree of regulation have weighed on the domestic banking sector. However, Erste Bank und Sparkassen were able to thrive even under these circumstances. Thomas Uher, chairman of the management board of Erste Bank Oesterreich: “In 2015 the group as a whole was able to gain a remarkable 195,881 new customers in Austria. Erste Bank's share thereof amounted to 62,883 new customers. In the final quarter of 2015 alone an increase of 50% could be observed compared to the third quarter. With that Erste Bank und Sparkassen now have a total of 3.46 million customers in Austria.” The new digital banking platform George has likewise achieved resounding success in recent months. “We have introduced George just one year ago. Since then we have already gained more than half a million active users”, states new chief retail officer Thomas Schaufler.

Demand for securities and loans increases

With the ECB's main refinancing rate at 0.05%, no bank can currently afford to pay high interest rates on savings deposits. However, these low interest rates have positive aspects as well. According to figures recently released by the OeNB, the volume of private loans has increased by EUR 5.4 bn. in 2015, to EUR 146.4 bn. in total. This represents growth of 3.9% vs. December 2014. Thomas Schaufler: “Customers can take advantage of low interest rates to finance their dream homes, and should hedge these historically low rates by taking out fixed-rate loans.” A significant increase in the demand for securities has been recorded as well. Thomas Schaufler, chief retail officer of Erste Bank Oesterreich: “Especially the new investment product YouInvest, which allows customers to invest in an actively managed umbrella fund, has become a true blockbuster. YouInvest's volume could be increased from EUR 507 m. in 2014 to EUR 817 m. at year-end 2015. This represents a gain of 61%.”

Satisfaction of customers above average

The study with 1,000 participants conducted by meinungsraum.at on behalf of Erste Bank shows that customers are expressing above-average satisfaction specifically with respect to customer services at Erste Bank und Sparkassen. Erste Bank chairman Uher: “We will however continue to work on improving the quality of our branch offices. Apart from the modernization of locations and advisory services, we are intensely focused on the extension of opening hours.” There are already 36 branch offices in Vienna that are staying open from Monday to Friday between 9:00 am to 6:00 pm.

Willingness of customers to switch banks increases

Significant shifts have to be expected in the banking market in 2016. Major changes at credit institutions domiciled in Austria have alarmed customers. The study reveals this upheaval as well. Erste Bank Oesterreich chairman Uher: “Currently 16% of our competitors' customers are planning to switch banks, which by contrast applies only to eight percent of our customers. Moreover, with a share of 77%, Erste Bank und Sparkassen can boast of having the largest percentage of loyal customers.” Apart from favorable terms, criteria customers consider ever more important are competent employees, easy accessibility, and highly advanced online services. Furthermore, 77% of customers regard it as important that their banking institution is under Austrian ownership. Chief retail officer Schaufler: “In order to provide an incentive to customers who are currently potentially willing to switch banks, Erste Bank is offering a cost-free account switching service with immediate effect. We carry out the account transfer from the former principal bank, give notice to employers, transpose standing orders, and dissolve the old bank account. The exercise can be performed online as well as offline; in addition, current account fees for people who switch will be waived for an entire year.”