Why CBA has invested $600m in building up business banking
Commonwealth Bank's business bank doesn't match its retail clout but head of business lending Grant Cairns says investment, technology and data is closing the gap.
Grant Cairns is Commonwealth Bank's Executive General Manager, Business Lending. The following interview has been lightly edited for brevity and clarity.
The business banking sector is an attractive one at the moment, providing a growth option as mortgage lending profitability tapers off, but there are also indicators of stress with higher interest rates, costs, insolvencies.
Generally speaking, we remain very optimistic about the sector. Businesses have built up tremendous resilience through COVID. Deposits have grown 33%. Now we have seen a little bit of, particularly smaller businesses, tapping into those reserves but we continue to see remarkably low arrears and defaults. That’s not to say that all sectors of the economy are going well. I think many businesses are finding things challenging, with labour, increasing costs.
But one of the teams I lead is business financial assistance which is a team who can be reached by our customers to talk about restructuring their facilities and talking about options. We have not seen an increase in calls from our customers - despite going out more proactively to our customers and our digital channels to let customers know this support is available. Certainly some sectors, certainly construction, have had a challenging period, that means tightening belts and that's going to mean potentially their spending. We haven't yet seen it play out in our portfolio.
