BNZ whistleblower says bank is still driven by sales targets

Monday, 19 August 2019

BNZ removed sales targets and bonuses for frontline bankers dealing face-to-face with the public in October 2018.

BNZ has removed sales targets for frontline staff such as personal bankers and call centre staff, but the pressure to sell has not gone away, a whistleblower at the bank says.

Following pressure from their Australian parent companies, which have been roasted for their hard-sell cultures in the Royal Commission into misconduct in banking, and from regulators here, the big four Australian-owned banks pledged to remove sales targets for frontline bankers.

But a BNZ insider, who would likely face disciplinary if identified, told Stuff that regional managers' sales targets had not been removed.

Following the removal of frontline bankers' sales targets, there was a brief honeymoon period in which pressure on frontline to sell products including loans, credit cards, insurance and KiwiSaver to customers was lifted, but when regional managers saw they would not hit their targets, they made their expectations known to branch managers, who passed the pressure on down to frontline bankers.

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All the big banks have pledged to remove sales targets and bonuses for frontline bankers.

'It lasted three to four months, until the regional managers saw they were way off their numbers. They said, 'We need to get some results on the board',' the insider said.

'As the year has gone by, we have veered right back to the numbers.'

This happened through pressure exerted verbally on branch managers by regional managers, and the branch managers transmitted it to frontline staff.

'While the banks have said no numbers publicly, the rubber band is snapping back to where it was.

'What we are telling people, and what's happening are not the same.

'That shouldn't stay hidden,' the insider said.

BNZ said public-facing staff like personal bankers and call centre staff were not judged on sales.

'There are no sales or financial targets in our branches and contact centres. This includes customer facing people and their leaders,' said BNZ spokesperson Michael Burgess.

'Measurements in our retail network are based on the quality of conversations our people have with customers, and on how well they follow our processes and procedures.

'Our branches and contact centres have not had sales targets and incentives since October 2018 and we would investigate immediately if we found the policy was not being followed.'

The whistleblower, who said they were able to forge a career in banking without having to compromise on personal ethics, was not opposed to targets, which should sit alongside customer service targets, just not being clear with the public.

'It's not about swinging the pendulum from one extreme to the other. It should settle somewhere in the middle,' the insider said.

In July, First Union claimed general secretary Dennis Maga said union members had reported suspicions that branch and call centre managers still had sales targets, which translated into sales pressure on staff.

'While the banks tell us [a conversation] shouldn't necessarily result in a sale, unfortunately what we find is some managers in different areas tell their staff that for an outcome to be counted, they have to get some sort of insurance quote from the customer, or a product outcome,' Maga said.

Like other banks, BNZ sees technology allowing customers to self-service can strip costs from their operations by reducing staff numbers.

The banks have adopted new methods of generating sales opportunities with customers, including scripting conversations staff should have with customers, and how many scripted conversations they should have in any set period.

'All the banks have made commitments to remove sales incentives from frontline staff and to revise sales incentives throughout all layers of management,' said Financial Markets Authority spokesman Andrew Park.

The FMA conducted a joint conduct and culture review of the bank with the Reserve Bank, and concluded banks were error-prone, had not invested sufficiently in their systems, were slow to pay customers back who they had overcharged, and that frontline staff were incentivised to encourage customers to go into debt, or insure more than they may want or need to.

'We have said the proof of these plans will be in their implementation and we expect these to roll out over the next year,' Park said.

'We will be watching this progress and monitoring what kinds of behaviours the banks are rewarding as they transition away from volume/targets-based remuneration.'

The insider said many members of the public were still trusting of bankers, but others had become suspicious of bankers' motives, and transparency was now demanded by a growing section of the public.

There had been high levels of turnover at BNZ, especially around several years ago when many were offered redundancy as the bank rolled out 'Project Future' which involved rolling out 'smart ATMs' across branches, and a 'hard reset' of branch staff numbers as BNZ customers were migrated from using tellers to transacting on the new machines.

Banks were also accepting that to attract and keep good staff, they had to be good corporate citizens. Younger workers joining BNZ were often startled to find themselves being trained to use aging DOS-based banking systems which required them to learn codes to navigate.