Mobile banking is regarded as perhaps the largest threat to Australia's big four banks — a doorway has opened up for technology giants around the world to enter into direct competition.
However, whilst Commonwealth Bank (ASX: CBA) and NAB (ASX: NAB) have recognised this threat and in response, upgraded their core legacy platforms, Westpac (ASX: WBC) reportedly has its own priorities.
As reported by The Australian, Westpac's chief information officer (CIO) Clive Whincup has stated that it was "foolish" and "a little arrogant" to believe that technology alone could be a strategy, arguing instead that customers "want a reliable service that is simple to use and always on tap, irrespective of where they are or what they are doing."
Since 2008, the bank has invested roughly $2 billion on technology systems and whilst Whincup certainly agrees that mobility was the greatest change in customers' expectations and behavior, wealth management and Asia have been prioritised as key areas for investment.
First and foremost, in an effort to achieve revenues of $700 million from the Asia region by 2017 (from around $100 million today), the bank will upgrade its Asia infrastructure to "enhance these relationships and deliver a truly unique customer experience." The potential to grow in Asia has also been recognised by rival bank ANZ (ASX: ANZ), which is aiming to draw between 25% and 30% of group revenue from the region by 2017.
The bank will also focus on building its next-generation wealth program, which it intends to be "easy to access and understandable" for the aging population. This will involve migrating its brands, such as St George and Bank of Melbourne, onto a unified platform.
Foolish takeaway
As is the case with ANZ, upgrading its core platform is not a key priority at this stage, although it is pleasing to receive some news on its goals and focuses leading into the next few years. ANZ has also previously stated that its growth in Asia would be prioritised over upgrading technology systems.
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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned in this article.
