Big four banks improve trustworthiness through COVID-19

Image by 'John' on Flickr

A new survey released today reveals Westpac, CBA, NAB and ANZ have improved their trust scores over the past three months.

The improvements are based on last quarter's results from market research firm Glow, which measured 31 banks on a scale from -100 to +100.

Westpac improved its score the most out of the big four, up to +8 from +3 last quarter.

CommBank went from +7 to +11, NAB from +7 to +10, and ANZ from +6 to +9.

Glow's head of insights Eddie Kowalski puts it down to waning effects of the royal commission, and the banks' perceived safety during COVID-19.

"COVID-19 and the resulting mortgage freeze, recently extended to January 2021, presented the big banks with an opportunity to redeem themselves in the eyes of the Australian public following the Royal Commission last year," he said.

"And so far, their efforts seem to be working."

However, Mr Kowalski said the true test will be when mortgage deferrals end.

“But is only when the proverbial – but inevitable – financial cliff emerges and Australians are required to pay up once again, whether in the form of increased mortgage repayments or through losses to their superannuation, that this built-up trust in banks will be tested," he said.

Want to earn a fixed interest rate on your cash? The table below features term deposits with some of the highest interest rates on the market for a six-month term.

'Second tier' banks still shine

Despite the improvements in the big four's scores, they still lagged behind smaller banks on overall trust.

Top ten 'most trustworthy' banks

Rank	Bank	Score	Previous rank
#1	Bendigo Bank	22 (+2)	#5
#2	P&N Bank	22 (-)	#2
#3	ING	20 (+1)	#6
#4	Bank of Sydney	20 (+6)	#10
#5	Heritage Bank	20 (+4)	#9
#6	Greater Bank	19 (+4)	#1
#7	UP Bank	19 (+2)	#7
#8	RACQ Bank	19 (-2)	#3
#9	CUA	17 (-3)	#4
#10	Beyond Bank	15 (-1)	#8

Source: Glow

On the other end of the scale, international brands tended to struggle.

Bank of China continued to slip, down to -27 from -21 in the previous quarter, while HSBC lost eight places in the rankings, with Citi sliding four places.

Mr Kowalski said this is due to a more "nationalist" mindset during COVID-19.

"Our research appears to reflect society’s continued retreat to an increasingly nationalist mindsets and more community-based values during the coronavirus pandemic, with the suggestion that this is influencing where Australian consumers choose to bank," he said.

"It will be interesting to see how this trend plays out next quarter.”

Neobanks continue to improve

As seen in the table above, Up Bank has continued to build its trust score, up two points to +19, holding steady in seventh place.

'Australia's first smartbank' 86 400 also improved by six points, and so too did Xinja, which was previously Australia's fifth-least trusted bank.

Survey respondents are asked to rate how much they trust each bank they are aware of 'to do what is right', and the responses are then weighted on the -100 to +100 scale.

Responses were collected from 23 to 30 June 2020 and totalled 1,230.

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