Australian Companies Unimpressed by Big Four Banks

Business sentiment towards Australia’s ‘Big Four’ banks has fallen to its lowest level in nine years, according to the latest East & Partners business banking index (BBI).

The BBI, which monitors business customer behaviour towards Australian banks, found the Big Four of Commonwealth Bank of Australia (CBA), Westpac, Australia and New Zealand Banking Group (ANZ) and National Australia Bank (NAB) achieved an average score of 24.4, where 10 equals low and 100 high). This was 10% below the market average and nearly three times lower than the best performing bank – BOQ.

“The Big Four’s relatively lower aggregate score reflects persistent dissatisfaction, compounding over an extended period of time.” said East & Partners analyst Jessica Gao.

Since March 2012, sentiment towards three out of the four majors has fallen by almost 20%.The BBI confirms that poor business banking relationships are more prominent among small businesses. The micro business segment, with an indicative BBI score of 11.4, is more than five times less satisfied than the well-serviced corporate segment, which has a BBI score of 60.6.

Overall business banking sentiment is collected from chief financial officers’ (CFOs) and treasurers’ collective survey responses to empathy, loyalty, satisfaction and advocacy. Loyalty and advocacy perennially weight the index negatively and the lowest ranking is consistently attributed to a Big Four bank.

Almost no business customers currently advocate their Big Four bank to friends or colleagues. On the BBI scale of 10 (would not recommend) to 100 (would recommend), three out of the four Big Four banks rate below 13.

“The Big Four’s business customers are clearly disengaged,” said Gao. “Advocacy and loyalty are now practically non-existent. This is excellent news for competitors outside of the Big Four, with business owners actively seeking alternative solutions across the full product suite.”

Small businesses in particular are exploring working capital and cash flow relief options outside of traditional channels. BOQ, Suncorp and St George consistently score above average across all four contributing metrics and are set to benefit from business owners exasperation when it comes to dealing with their relationship bank.

BOQ achieves the highest overall BBI score of 65.9, trending higher over the last two years and representing the most highly satisfied business banking customers market wide.


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