In buying ME,BoQ is set to double the size of its retail bank,and leapfrog second-tier rivals to emerge with the sixth biggest loan book in the country,narrowly behind Macquarie Bank.
Mr Frazis said the “game-changer” deal would create a bank that was more efficient,less skewed towards capital-intensive business lending,with less exposure to customers in Queensland.
While some in the market have raised concerns about the complexity of bank mergers,Mr Frazis pointed to the productivity gains it hoped to extract,which should make it a more effective competitor to the major banks.
“In three years’ time we’ll be in a position that makes us very competitive from a customer service and a productivity perspective,” Mr Frazis said.
BoQ hopes to extract $70 million to $80 million in synergy benefits within three years,and Mr Frazis emphasised the fact that both ME and BoQ were moving to the same digital banking platform,while also foreshadowing likely changes in management.
Mr Frazis said the core system being adopted across the bank would allow BoQ to maintain the ME brand,alongside its Virgin Money brand,to target different customer segments more efficiently than it does today.
“The thing that is really unique about this,and an absolute game-changer,is that what we’re able to do is go all in,in terms of a cloud-based system,” he said.