New Horizons Managing Growth Stephen Coulter General Manager Global eCommerce Commonwealth Bank of A

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New HorizonsManaging GrowthStephen
CoulterGeneral Manager Global eCommerceCommonwe
alth Bank of AustraliaJune 19, 2001
e - c o m m e r c e s o l u t i o n s
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Disclaimer

• The material that follows is a presentation of
  general background information about the Banks
  activities current at the date of the
  presentation, 19 June 2001. It is information
  given in summary form and does not purport to be
  complete. It is not intended to be relied upon as
  advice to investors or potential investors and
  does not take into account the investment
  objectives, financial situation or needs of any
  particular investor. These should be considered,
  with or without professional advice when deciding
  if an investment is appropriate.

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Group Strategy
WHY?
Business Goals
Strategic Vision
Financial Goal
Top Quartile TSR
Growth with low inflation
To be the best brands in helping customers
manage and build wealth
Major technology shift
Pace of change
Limited longer term domestic scope
Margin squeeze
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Index of Top Consistent Performers
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SPI through December 2000.
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Source Oliver, Wyman Company Report Number 3
Volume 11 March 2001
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Flashback Analysts Presentation May 27, 1999
e - c o m m e r c e s o l u t i o n s
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Analyst Presentation, May 27, 1999
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Flashback Analysts Presentation May 27, 1999
e - c o m m e r c e s o l u t i o n s
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Analyst Presentation, May 27, 1999
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Flashback Analysts Presentation May 27, 1999
e - c o m m e r c e s o l u t i o n s
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Analyst Presentation, May 27, 1999
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Commonwealth Group Home Page
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Strategic battles around relationships have been
successful.
Measure Jun 99 Jun 00 Jun 01 est NetBank 89,400 32
5,000 900,000 Quickline 23,600 36,000 50,000 Mobil
eBank - 6,500 17,000 Diammond/eCommCorporate 6,10
0 7,300 8,000 ASB/BankDirect 18,000 58,000 100,00
0 Banking 137,100 432,800 1,075,000 ComSec
Online 60,000 155,000 225,000 HomePath - 36,000 1
00,000 Total Online Customers 197,100 623,800 1,4
00,000
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As have our alliances...

• EDS
• Telecom NZ
• Vodafone
• KeyCorp
• CommerceNet
• Knowledge Lab
• Cyberlynx

• Australia Post
• Woolworths Ezy Banking
• ninemsn

Market Access
e - c o m m e r c e s o l u t i o n s
Alliances
Technology/Skills Access
Risk Sharing

• EDS
• TelecomNZ
• Vodafone
• SupplySearch
• KeyCorp
• Cyberlynx

Scale Economics
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c o m m o n w e a l t h b a n k

• EDS
• Telecom NZ
• ninemsn
• Cyberlynx

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Customers are moving transactions and business
activities online

• Transactions
• December 2000 profit announcememt we advised 84
  of transactions are now electronic versus 16
  over the counter
• Over 1,800 online merchants
• Over 10 billion in payments through NetBank
• 80 of Commsec trades occur online
• Total transactions of 34 million online in April
  2001
• 4m in 98, 8.5m in 99 and 18.5m in 2000
• Sales
• Over 4,000 credit and 10,000 deposit account
  applications per month online
• Inquiries
• Over 17 million service enquiries per month via
  NetBank

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Commonwealth Group is applying web technologies
to its own business
e - c o m m e r c e s o l u t i o n s

• Finance and Human Resources with PeopleSoft
• IP enablement of all premises
• Target of end July for all branches to be cabled
• eProcurement with Cyberlynx
• Growing intranet applications and information
• Over 2 million activities per week
• Online Shareholder and Media Centres

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Intranet Development Usage is Improving
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Shareholder Centre for Investors
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Cyberlynx has been successfully implemented
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Looking Forward.
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Commonwealths Online Vision
In chosen markets, to be the leading global
provider of online information services related
to financial services in a profitable manner.
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Requirements

• Retain and attract commercially astute, eCommerce
  aware people
• Customer focussed information
• Network and device independent
• Anything, Anywhere, Anytime
• Decision support, Information, Education and
  Advice
• Web enable our enterprise

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There is no new economy
e - c o m m e r c e s o l u t i o n s

• There is one economy
• There are old and new ways of doing business
• Old truths still prevail
• Customers
• Products and Distribution
• Returns to owners
• Employees retain and attract
• Community support and earn respect

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The only sustainable competitive advantages will
be customer service and trust
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• Products are commoditising
• Price differences will narrow
• Low costs will be a hygiene factor

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Customer Performance Model
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Customer Retention
Customer Acquisition
Customer Share of Wallet
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Customer Value
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NetBank customers are valuable
Product Penetration
Balance vs Average Customer Online
Customers Average Customer Credit
Cards 31 76 130 Loans 14 46 178 Deposi
ts 81 98 100
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• Online Customers also make significant use of the
  Internet for product origination, enquiries and
  transactions.
• These are the tip of an online-influenced iceberg
• Cross Channel referrals and service are vital
• Monitor sales rates by origination point
• Monitor quality of business by origination point

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Organisations are now realising the power and
value delivered from end-to-end web enablement

• Better customer service leading to revenue growth
• Lower internal delivery cost
• Quicker time-to-market
• Lower distribution costs

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Trust as a competitive advantage

• Identification
• Authentication
• Security
• Privacy
• Integrity (Data Message)
• Fairness Honesty
• Experience
• Stability

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Trust based services will grow..
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Account AggregationBring My Information Together
at One Web Site with one user name and password.
e - c o m m e r c e s o l u t i o n s
Site User Name Password Commonwealth
Bank abcdef 123456 ComSec ghijk 789012 NAB 6578hkj
f87 -82roi eTrade lq3i33 oppof8 Westpac offewupoi
3287j Hotmail iuywhvkj 9387 Ozemail klewkk 098j98
Qantas fefewif 997ug4 Wall Street
Journal ioewf 237809 GolfWeb iufulvjvj 08070 F2 ji
ogkjv 8787r0 Financial Times lkjeslkjg 98732070 In
dividual Inc iohefhff 8747r709 etc etc etc
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Commonwealth Bank Example
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Commonwealth Bank Example
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Aggregation Issues

• Trust
• Banking Terms Conditions
• Customer Consent/Authority Process
• Privacy Security
• Fraud Mitigation
• Liability
• Advice

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Summary

• eCommerce and eBusiness are significant business
  tools not strategies in themselves
• Successful businesses need to integrate these
  tools as part of their overall business strategy
• Leading incumbent players have significant
  advantages and opportunities
• Customer base
• Brand
• Multi channel distribution
• Customer Service Trust will be critical for
  future success
• Commonwealth Group has and will continue to be
  trusted and successful in applying eCommerce
  tools to its business strategy, benefiting
• Customers
• Employees and
• Shareholders

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