“We have made much progress but progress to us here at ANZ is not just how many accounts we have opened nor how much people have saved with us. It is more a question about how we are contributing, how we are helping to unlock the potential in rural areas of the Pacific and whether we are making a real difference to the lives of the people we provide bank accounts and other services to.”
- Mike Guerin, new managing director of ANZ's Pacific operation.
by Dionisia Tabureguci
PACIFIC island countries are going to see more of the Australia and New Zealand Banking Group as it continues to make its presence felt in the region.
The new managing director of its Pacific operations Mike Guerin said the bank has a number of plans geared towards extending its reach in the region further than the 10 countries that it operates in.
“I believe ANZ can contribute to the local economies by providing international expertise and knowledge transfer, building local employment opportunities and international career options for Pacific islanders and by ensuring ANZ maintains and grows points of representation throughout the Pacific,” said Guerin in an interview with Islands Business Magazine.
ANZ, the fourth largest bank in Australia, has presence in Vanuatu, Tonga, Timor Letse, Solomon Islands, Samoa, Papua New Guinea, New Caledonia, Kiribiati, Fiji, Cook Island, American Samoa, together contributing over A$100 million a year to the Group’s financial results.
In return, ANZ has been a major player in financing businesses in the region as well as making available financial services to the rural communities through its rural banking partnership with the United Nations Development Programme.
Guerin said the bank has an obligation to be an even greater contributor to innovation, employment, investment, increased productivity and community support across the region. “We need to better structure our business to strengthen organic growth and support inorganic growth opportunities. I see a need for greater specialisation and an even stronger focus on our customers and building on our customer value proposition,” he said.
Being a large business in the region also comes with certain responsibilities and in the past, banks have come under fire, accused of directing funds only to sectors that are doing well and lessening their exposure to suspect sectors in order to save their skins.
An example is the Agriculture sector in Fiji in the last five years when the sugar industry began to go down. The decline was reflected in the drop in commercial banks lending to the sugarcane-growing business, which decreased from over F$85 million in 1994 to F$14.9 million in 2001 to F$4.7 million in 2005, according to Reserve Bank of Fiji statistics.
Guerin offered a bank’s perspective on this. “Fiji’s sugar industry is presently going through some changes designed to better position itself for future prosperity,” he said. “Prudent management of their debt levels and repayment obligations is important to industry participants while they seek to place the industry on a stronger footing. One of our obligations is to ensure we not lend money to people and industries where resultant repayment obligations will further stifle their ability to remain viable,” he added. The bank believes its role in stimulating activities in the rural areas is being delivered in a more holistic way.
An example of this, Guerin said, is the ANZ-UNDP rural banking partnership, designed to benefit rural dwellers and not just those involved in agriculture.
The project, piloted in Fiji, is now made available in Samoa, Tonga, American Samoa, Papua New Guinea, Kiribati and the Solomon Islands.
To date, the project has opened over 60,000 accounts and mobilised over AUD$3 million.
“We have made much progress but progress to us here at ANZ is not just how many accounts we have opened nor how much people have saved with us. It is more a question about how we are contributing, how we are helping to unlock the potential in rural areas of the Pacific and whether we are making a real difference to the lives of the people we provide bank accounts and other services to,” said Guerin. “
People now have a safe place to save with a bank that comes to them, they are able to borrow at competitive interest rates to improve their homes, start small businesses or purchase a truck for their village. Parents are able to save for school fees, pensioners in rural areas now don’t have to spend most of their monthly benefit on paying for transport to town and most people have enough savings to get them through an unexpected natural disaster,” Guerin added.
He said the bank’s Pacific operation would be using the rural banking project to expand its lending to agriculture.
“The future will see ANZ continue to expand into new countries; develop new products and services to ensure we keep up with the needs of our customers and partner with new organizations and increase the availability of banking services in rural areas. Financial literacy and our partnership with UNDP will remain a cornerstone to all future developments.”
Overall, the bank sees opportunities across the board and would be strengthening its focus on specialisation, with tourism being an industry high on its priority list.
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NOTE: This article appeared as: “TOURISM HIGH ON BANK’S PRIORITY LIST”…Guerin has plans to extend ANZ’s reach; pp 42,43, November 2006 edition.
Islands Business is the flagship publication of Islands Business International.
In this blog, picture of Mike Guerin in a press conference in Suva supplied by ANZ Fiji.
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