Ask the boss: Post Office can take on big banks
FINDING a challenger bank to take on the big high street lenders is a problem Des Crowley thinks he has got licked.
He believes the UK’s network of post offices, with 18 million customers a week at 11,696 branches, can deliver the perfect solution to creating greater competition.Crowley is chief executive of Bank of Ireland UK which this year celebrates its 10th anniversary as partner in Post Office Financial Services which has 2.8 million customers.
The two teamed up for a foreign exchange service in 2002. It is the largest over-the-counter currency provider with market share up from 5 to 25 per cent.
They forged a full partnership in 2004 and it now handles £17billion of savings and £3billion of loans, as well as offering insurance, credit cards and a fast?growing range of current accounts and mortgages, with financial advisers in 320 outlets.
I see the Post Office as a challenger brand with the Bank of Ireland as the bank behind it
The joint venture also operates 2,500 cash machines. Crowley believes the branches give them a huge competitive advantage.
He said: “This is a unique way to build an alternative to the big banks. We both feel we can create a real choice for consumers. I see the Post Office as a challenger brand with the Bank of Ireland as the bank behind it.”
The Dublin-based group foothold in the UK already included its branches in Northern Ireland and the mortgage business of Bristol & West building society, bought in 1996. But the Post Office partnership, recently extended to 2023, took this to a new level.
Crowley’s goal is to grow its market share to between 3 and 5 per cent and to nearly double customer numbers to 5 million, underpinning the viability of the Post Office. Bank of Ireland UK has played a crucial role in helping its parent survive the financial crisis without need to nationalise. The Irish bank has since repaid its bailout money and its return to normality has attracted big American and UK pension funds as investors.
Father-of-two Crowley insisted Post Office branches were the key to growth in the UK. He said: “The bedrock has got to be the presence in the community, the trust and the familiarity.”