Goodbye, Commonwealth Bank!

Like many other people, I was incensed when on Melbourne Cup day, the Commonwealth Bank raised interest rates by 40 basis points when the RBA had lifted the official cash rate by 25 basis points just moments before.

I’m acutely aware of the need for Australia to have a strong banking system and for banks to be profitable. But these profits go beyond just being profitable and can only be described as obscene. The pitiful excuse from Ralph Norris and the other big bank fat cats that the cost of funding has gone up does not hold water. The fact is, their bottom line profit is unprecedented, so it doesn’t really matter what they are paying for funding.

I’ve been a Commonwealth Bank customer for 25 years. In that time I’ve had a few mortgages and since starting my business in 1994, they have been “my bank”

As part of my business banking, I have a savings account into which goes things like GST collected and tax offset money. It’s called a “Business Online Saver” and it attracts interest at about 4.75% as long as you maintain a balance of $10,000. I also have a standard cheque account and a credit card for the business.

So, suitably fired up, I shot off an e-mail to the bank strongly suggesting that they increase rates on deposits by the same amount. Three days later I get a call from a bloke purporting to be my “relationship” banker. An animated discussion ensued during which he told me it was not possible for the bank to increase rates on deposits by the same amount and giving me the same limp excuses about funding costs.

“But what I can do for you straight away”, he told me “Is to give you an extra 20 points on that Online Saver”

“You can do that?”, I said with a degree of incredulity. “Oh yes,” he said, and I could almost see him puffing out his chest.

“But you’d never have offered it to me unless I arced up, right?”

I told him that I would be leaving the bank and taking my bit of money elsewhere.

The Commonwealth currently has this ad campaign going with the tag line of  “….determined to be different” I think they should amend that to read “The Commonwealth Bank; determined to be different: Failing miserably”

Yesterday, following research, I walked into the Bank of Queensland branch in Willetton and opened  two comparable accounts and  obtained a credit card.

My research told me that BOQ was right for me because the bloke that manages the branch owns the branch. It’s a sort of franchise which means that the Branch Manager, Mike Hancock, is like me; a small business person with the same sort of issues and an understanding of my position.

I get everything I’m currently getting from the Commonwealth in terms of fees and charges. In fact, I’m probably a bit ahead. But I will get better service and none of the arrogance I get from Ralph Norris.

And I will feel so much better than I am no longer contributing to their obscene profits. 

Over the next month, I will gradually migrate my business from the Commonwealth to BOQ and then close all my accounts and walk. A 25-year association will end.

But I’ll probably be the only one to notice.

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