Westpac aims for 30 per cent penetration
Westpac is aiming to sell financial services products to 30 per cent of its 5.6 mil-lion strong customer database.
Westpac is aiming to sell financial services products to 30 per cent of its 5.6 mil-lion strong customer database.
Westpac has sold financial services products to 450,000 customers (or 7 per cent of its total customers) and general insurance products to another 400,000.
“We have a long way to go to reach world’s best practice but we are aiming to achieve it in the medium term,” says Westpac Financial Services (WFS) joint man-aging director Michael Migro.
However, the 450,000 existing Westpac customers who have already purchased WFS are continuing to drive strong financial performance for the group.
In fact, WFS recorded a 40 per cent increase in profits to $154.6 million for the year to September 31 on the back of an 18 per cent rise in sales to $5 billion.
Migro says the big rises in sales came from steady growth in superannuation, in-vestment and retirement products. He says there was particularly strong growth in risk products, albeit from a smaller base.
Sales of new premiums grew 49 per cent over the year to $20.7 million. Market share in disability products increased from 4.1 per cent to 5.5 per cent and Migro says the portfolio remains profitable for the group.
Migro also attributed the strong sales growth to the success of the strategy to serv-ice customers with less to invest than those services by other financial planners.
“Our average customer has $25,000 to invest. Most financial planners would not want to have these people as their clients,” he says.
WFS has also altered its international investment strategy, dumping its three over-seas managers in favour of a index approach for its international equities portfolio.
WFS joint managing director Sean Mays says the decision to dump the managers was extremely poor performance which had been dragging down the numbers for the group’s balanced funds.
“An investment manager caused one of our balanced funds to dip 1.5 per cent,” he says.
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