Former BNZ Chief Needs Funny Bone Transplant

"This man needs a funny bone transplant," was the response of Kiwibank founder Jim Anderton to the recent description by former BNZ chairman Kerry McDonald of the Kiwibank 'join the resistance' advertising campaign as 'reprehensible' and 'outrageous'.

"The campaign is amusing and imaginative, drawing as it does on what an editorial in the Southland Times calls "the peace and serenity in a New Zealander at the thought of an aggrieved Aussie." Its use of the symbolism of plucky and successful French resistance to fascist occupation and the motif of the little green car are inspired and hit just the right note.

"It's hard to escape the impression that this is sour grapes," said Mr Anderton. "When I first mooted the idea of the bank there was a universal howl of derision in financial circles. They are eating their words now. The foreign owned banks had a cosy little set-up and didn't at all cotton to the idea of some real competition. Instead, they had shut down services wholesale. Hundreds of thousands of New Zealanders had lost access to a local bank branch as the big banks closed down more than twelve hundred branches, and credit card and mortgage rates were sky high. But I had faith in what a bank which genuinely serves New Zealanders could do, drew up a business plan with the assistance of New Zealand Post in the face of the critics, and convinced my sceptical Cabinet colleagues. Five years down the track my faith and that of the many New Zealanders who supported the idea have been amply repaid.

"Not a single branch of the overseas banks has been closed since. On the contrary a number of the foreign banks have begun to re-open branches. But Kiwibank, with over three hundred banking outlets now has the largest network of financial transaction centres in the country. Credit card and mortgage interest rates have tumbled, and the bank came into profit literally years ahead of the projected business case forecast. It now serves over 650,000 customers. It's very odd that a leading member of the Business Round Table like Kerry McDonald should not support the salutary advantages of a little bit of competition.

"The success of the bank has not, of course, stopped the harping of critics like Mr McDonald, who should know better than to repeat the totally unfounded sneer that the Kiwibank has only succeeded because it is government subsidised. Mr McDonald of all people ought to know that the bank has not received a single dollar in government subsidy. The money advanced to Kiwibank by the Labour/Progressive government came from the $500million in dividends earned by New Zealand Post and has been more than recovered already. Kiwibank now has a capital value equivalent to the asset value of New Zealand Post itself - around $500million - and that after just six years in business. Not bad for 'a dog of an idea' as it was described by many commentators at the outset.

"It is now deeply embedded not only in the fabric of our financial system, but in the affections of the great majority of New Zealanders, who continue to join it at the rate of two thousand a week. Even the incoming National led government, which is no friend to successful state enterprises, knows better than to talk openly about disposing of it. Mr McDonald would be well advised to get 'on message' with his fellow New Zealanders and to leave the Kiwibank alone.

And talking about having cordial relations between New Zealand and Australia, has Mr McDonald ever heard about apples?"

ENDS

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