Westpac Asia provides Australia and New Zealand expertise to support growing two-way trade and investment flow for corporate customers, interbank and business banking. The bank currently has three branches in Asia - Singapore, Hong Kong and Shanghai. It also has reprehensive offices in Beijing, Mumbai and Jakarta.
The branch in Shanghai is located in the Jin Mao Tower, a prestigious and secure building in the financial district.
Given the limited growth opportunities in Australia, it makes strategic sense for Westpac to expand into the booming Asian region. Although the bank has experienced difficult financial times in the early 90's, it has recovered and is now a healthy and solid business.
Of the Australian banks, ANZ was the first to enter the Chinese market. CBA is also present in the Chinese market, which has significant stakes in numerous banks in China. However, Westpac has a unique strategy, opting to pursue organic growth in the market. Instead of trying to be global and compete against the big banks, Westpac is in China because its customers are. Martin described its expansion into China as a defensive move, so that it doesn't loose its current customers to other banks such as CBA or ANZ.
Their focus is on business banking (small to medium sized businesses) with a small retail presence. However, it is limited to loans and deposits denominated in foreign currency.
Westpac is able to achieve a competitive advantage by understanding their existing customers businesses and leveraging off this relationship in Australia. The critical success factor for Westpac in China is customer retention. The risk that customers switch banks when in China could be damaging and costly for the company in the long run. They are primarily targeting the Australian community in China and also the Chinese community who are interested in Australia.
The bank has 18 staff members in total, of which 13 are female. It is targeting local employees, as part of an HR strategy to hire people that can speak Chinse whilst minimising the high costs associated with relocating Australian employees in China. Westpac has a separate team that looks at strategy in Asia, such as expansions of the banks presence and product offering.
Although Westpac doesn't have a strong brand presence in China, it does have some strengths from which it can build on. The association of Australia, which has a non-threatening and 'good image' in the Chinese community. Westpac also has a good track record in corporate responsibility, something which the Chinese people value strongly. There are also benefits associated with being an English-speaking bank. It has resurrected some old Australian advertising, using the slogan, 'Australia's First Bank'. This is a good fit for building a good brand association and understanding in China at its early stages. Its value proposition is simple - Help customers, which is an extension of its successful relationship model.
