As Australia’s St George bank will be replaced by the Bank of Melbourne (BoM) next week, it also plans to unveil a new strategy that could slash over one percent of mortgage rates for customers who bring across other accounts.
St George bank will be switching to the new Bank of Melbourne brand next year, and the new bank will be Westpac’s A$100 million attempt to re-establish a regional banking brand in Victoria, where it has only a 13 percent market share.
Scott Tanner, Chief Executive of BoM, said the bank will be a competitor to its parent company, which acquired St George bank in 2008.
“We’re hungry for business,” said Tanner. “We’re going to be very competitive on all fronts.”
BoM plans to discount mortgages if customers switch products from other banks. Tanner said this could cut more than one percent from the bank’s standard variable home loans for several customers.
St George bank has five corporate banking centres and 38 retail branches in Victoria. Starting 25 July, there will be 41 BoM branches, with 85 more branches expected to open over the next four years. Westpac, which acquired the Bank of Melbourne brand in 2004, is injecting A$90 million into the rebranding and will likely spend approximately A$750,000 on each of the 85 new branches.
Tanner noted that Westpac reports describe Melbourne as a “provincial global community” that had not helped the launch.
“If you’re a Victorian and somebody describes Melbourne as provincial, you’d be pretty annoyed at that but that isn’t what happened,” he said. “That was a third party we’d asked for an opinion on how to think about Melbourne to a Sydney board.”
“The actual quote was provincial global city . . . it’s trying to say it’s not a capital city, it’s not an international city like Sydney— it actually regards itself as a provincial global city.”
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