No Names

Two Netherlands-based rival financial institutions, ING and Rabobank, have quite different brand recognition levels among Australian consumers.

However at a time of high risk-aversion and safe-haven seeking consumers, few people point to Rabobank, which is AAA rated, as being strong while a quarter pointed to ING (only AA rated).

The finding underlines the power of brand in the current climate and how the promotional strength of one scottish comedian carries more weight than a Standard & Poors’ AAA rating - all four major Australian banks, unlike Rabobank, are also only AA rated.

ING Direct and RaboPlus, two online high interest bearing cash deposit accounts, offered by the above two institutions have polarised brand recognition levels among consumers.

ING recorded 23.5 per cent compared with just 1.2 per cent for Rabobank, by respondents when asked about the strongest brand in the market for term deposits, in the Cash Deposit Survey conducted by CoreData.

The second highest assessment was given to Commonwealth Bank of Australia, with 11.7 per cent.

When the same question was asked about at-call accounts, a similar result of 19.4 per cent for ING was recorded and with just 5.4 per cent for Rabobank, with Commonwealth Bank again second to ING with 13.0 per cent.

Rabobank’s brand strength has been identified as weak in the survey for retail deposit products, but the bank’s strength is the opposite according to ratings agency Standard & Poor’s.

ING Bank has the same AA rating as Australia’s big four banks, Australia and New Zealand Bank, Commonwealth Bank, National Australia Bank and Westpac Bank.

Yet Rabobank, with a AAA Standard & Poor’s rating – the highest qualification of credit status S&P issues – trumps ING and the big four Australian banks.

But high levels of brand perception though are not a precursor to attracting customers.

ING’s retail deposit book in Australia fell 5.7 per cent to $16.4 billion during 2008, when the combined retail deposits for Australia increased 21.6 per cent to $467 billion.

For the same period, Commonwealth Bank increased retail deposits by $23.8 billion, or 24.8 per cent, to $120 billion, according to CoreData’s Retail Deposits Report.

The Cash Deposit Survey was conducted by CoreData during January 2009, and forms part of The Australian Cash Report, distributed by CoreData.

One Comment on “No Names”

• February 25, 2009 at 3:26 pm
  john venn says:

  Hi there,
  It is understandable WHY people are not looking at the ratings for various banks.
  The whole rating(s)sector for banks etc has come under scrutiny as they have broken every rule and the public has lost faith with the whole financial sector.
  Hence the case, not of the screaming Scotsman
  but faith in the system.
  Our banks were insolvent but we were not told for we Australians live in many ways under the banner of “free enterprise” except telling and letting the public really know whats going on is secret stuff, held back in the name of “public interest”.
  Let’s thank the US for setting the pace of being open and respectful to their public.

  Reply