Most National Australia Bank customers now interact with the bank exclusively through digital channels and the bank’s digital-only offshoot, UBank, increased its customer base by 40 per cent over the last two years, according to NAB’s financial results released today.
The bank also revealed it has shifted 19 per cent of its IT applications to the cloud and reduced legacy applications by 11 per cent since starting a three year transformation program in 2017.
The digital milestones stand out in what NAB interim CEO Phillip Chronican described as a “very challenging” year which included the Royal Commission, which revealed years of misconduct by Australia’s big banks. NAB’s customer remediation of $1.1 billion dollars kept net profit to $4.8 billion, a 13.6 fall on the previous year.
NAB reported that customers of UBank, the incumbent’s online-only bank, now number over 550,000.
UBank, launched in 2008, promises lower interest rates for home loan customers because it does not have any branches or associated costs. It serves customers exclusively through digital channels and is bullish about new technologies like AI.
The number of UBank customers grew by 40 per cent since FY17 UBank, according to its parent’s latest report.
But most of NAB’s customers and their interactions with the bank are increasingly digital, according to its results.
66 per cent of the banks active customers are using digital exclusively and over half of “simple” consumer sales – like savings accounts, personal loans and credit cards – are now purchased online. Two years ago just 31 per cent of the simple consumer sales were done online.
The bank reported its customers had logged in to its mobile apps 657 million times in the last year.
The digital channels and the rollout of 835 smart ATMs has led to a 30 per cent drop in over the counter transactions since FY17 and the closure of 95 branches and business banking centres.
On the back end the bank has removed 278 legacy IT applications over the last two years and wants to remove another 20 per cent in the next three years. NAB says it currently has more than 950 staff certified in either AWS, Azure or Google Cloud.
But the man NAB credits with starting its cloud journey, Yuri Misnik, resigned from his CIO role last month and an announcement on his replacement is yet to be made.