Tag: ING Direct

Australia’s Most Hated Fees Revealed

ATM fees frustrate Australians more than other banking and credit card fees and travel booking fees according to new research from ING DIRECT. Almost all Australians will take some action to avoid paying ATM fees – half will walk 10 minutes out of their way to get to a free ATM and 42 per cent will buy something they don’t need to get cash out.Almost half of the people who hate travel fees feel they are being ripped off. Top 5 accepted fees include Wi-Fi, restaurant service charges and mobile data roaming

Almost three quarters of people (72 per cent) who hate ATM fees say that it is because they believe it’s a service that should be free.

Psychologist Amanda Gordon explained, every day millions of people are feeling the frustration of paying fees and charges they think are unfair.

“Fee frustration may not seem significant, but these feelings of resentment can impact our ability to maintain a positive outlook in other aspects of our lives. Financial issues are regularly raised as a cause of stress for Australians, particularly among young women. Interestingly, ING DIRECT’s research shows that millennials and women were more likely to feel frustrated or angry about paying fees.”

“Bad spending habits are hard to break. Just like other habits, we need to become aware of what we are doing, stop following that same well-worn pathway without thinking, and actually notice where our money is going, rather than just complaining that it is disappearing. The best way for Australians to get ahead is to consciously and regularly focus on their finances by practicing money mindfulness,” said Gordon.

Apathy costing Australians dearly when it comes to paying unnecessary fees

John Arnott from ING DIRECT said people should not have to pay fees to access their own money.

“When you think about the total cost Australians pay in fees and charges it can have quite an impact on the family budget, which is already strained for many people.”

“Australians waste $500 million on ATM charges each year so it’s no surprise that’s the fee that tops the list. Our research shows almost all Australians will take some action to avoid ATM fees, but still too many people are paying. If you make two or three withdrawals a week, you are talking more than $300 a year, which is $300 too much,” he said.

Top ten fees Aussies find hardest to bear

  1. ATM fees
  2. Bank monthly account fees
  3. Booking fees for events and tickets
  4. Credit card surcharge fees
  5. Credit card annual fee
  6. Travel fees (e.g. airline booking fees)
  7. Fee for receiving a paper statement by mail
  8. Charge to use public toilets
  9. Road toll charges
  10. Late payment fees

Top five fees Aussies accept

  1. Wi-Fi fees
  2. Restaurant service charges
  3. Mobile data roaming charges
  4. Parking meter fees
  5. Currency conversion fees

ING Direct Australia Reports Record Profit

ING DIRECT Australia today announced a record net profit after tax of $314.7 million for the 12 months to 31 December 2015, an increase of 6% on the previous year.

ING DIRECT CEO Vaughn Richtor says industry leading customer advocacy is responsible for strong customer growth across all products, particularly the Orange Everyday payment account.

“A third of the growth in Orange Everyday accounts is coming from the recommendations of existing customers,” Mr Richtor said.

“It is particularly satisfying to see so many customers recommending ING DIRECT to family and friends.”

Mr Richtor says the strong growth in Orange Everyday payment accounts underpins ING DIRECT’s primary bank strategy.

“Having an Orange Everyday account increases our customers’ propensity to also have their savings account, a mortgage and superannuation with us,” Mr Richtor said.

2015 highlights include:

  • Orange Everyday (payment account) customers up more than 47% to 144,869 (Total 418,049)
  • Personal savings up by $2.1bn or 9.9%
  • Total deposits up $0.9bn or 2.8%
  • Branded mortgages up $3.8bn or 10.8%
  • Total mortgages up 2.6% to $39.8bn
  • Superannuation funds under management up 45% to $1.6b
  • Number 1 Net Promoter Score (customers willing to promote the bank to friends and family)

Mr Richtor says ING DIRECT has largely completed the sale of its white label mortgage portfolio while focusing on growing branded mortgages.

“Our brand is successfully evolving from being  a savings champion to becoming  the main bank for our customers’ needs.” Mr Richtor said.

Mr Richtor, who was the founding CEO of ING DIRECT, announced his retirement from the business and will be leaving in June. Mr Richtor will be replaced by Uday Sareen from June.

“I am immensely proud of the business and what has been achieved since our launch in 1999,” Mr Richtor said.

“Our business model challenged the way in which Australians did their banking and, while some doubted we would succeed, the provision of value for money products and exceptional customer service has proved a winning formula.”

“Creating the right culture in an organisation is the best way of ensuring the business does the right thing by the customer,” Mr Richtor said.

Macquarie buys up mortgages in $1bn deal

From Mortgage Professional Australia.

Macquarie Group agreed to buy the rest of ING Direct’s unbranded mortgages portfolio in a $1 billion deal with the Dutch lender, The Australian reports.

This will take its mortgage book well above the pre-GFC peak of $25 billion.

In 2013, Macquarie bought a $1.5bn book of non-branded mortgages from ING Direct, then acquired a $1.6bn portfolio in 2014 and in 2015 followed with another $1.5bn deal.

Macquarie chief executive, Nicholas Moore pledged to restore the bank’s pre-GFC grip on the sector back in 2014.

The string of acquisitions from ING means this target has been far exceeded, prompting questions about where the bank’s aspirations in the market now lie.

Aussies tightening their belts this Christmas

According to ING, Aussies are taking control of their finances this holiday period, intending to spend $313 on Christmas gifts, significantly less than the US and UK.

The latest ING Special Report on Christmas and New Year found Aussies are cautious about getting caught out overspending during the festive period, with 73 per cent planning to spend less on Christmas this year.

As they focus on managing their festive finances, Aussies anticipate spending just 7 per cent of their monthly income on Christmas gifts, less than half of the 15 per cent US and UK counterparts intend to fork out.

Additional findings:

  • 63 per cent of Australians don’t save money for Christmas and only 29 per cent put money in a separate account to pay for Christmas costs
  • One in ten (12 per cent) Australians went into debt to pay for Christmas last year, however this is still less than the US (20 per cent) and UK (15 per cent)
  • 14 per cent of Victorians admitted going into debt to pay for Christmas last year, closely followed by people from NSW (13 per cent), while South Australians were the most budget conscious, with less than 8 per cent spending beyond their means last Christmas

John Arnott, Executive Director, Customers, ING DIRECT, says: “Christmas and New Year is primarily about family, friends and fun, but it can become stressful – mainly because of the potential shock to the wallet.

“While some of us can be tempted to stretch finances almost to breaking point for festivities, the great news this year is that more and more of us are planning on keeping a close watch on our wallets, helping to minimise any New Year financial hangover.”

ING Christmas Spending League versus average income

 

Country
Median spend on Christmas presents (AUD^)
Spend as a percentage of average monthly earnings
Average monthly net earnings (AUD)*
Unsure how much they will spend
United Kingdom
656
15%
4392
42%
Luxembourg
469
9%
4983
45%
Austria
391
11%
3626
38%
France
391
11%
3476
42%
Germany
313
9%
3618
37%
Italy
313
12%
2713
40%
Spain
313
12%
2624
46%
Czech Republic
281
25%
1135
39%
Belgium
234
7%
3490
50%
Romania
172
32%
541
40%
Poland
109
11%
991
50%
Netherlands
63
1%
4367
41%
USA
563
15%
3690
33%
Australia
313
7%
4564***
44%

^ Median spend on Christmas presents converted from Euro to AUD. Currency conversion based on exchange rate as at 18 October 2015
* Source – Eurostat. For the year 2014, average net earnings for countries other than Romania and Australia; converted from Euro to AUD based on exchange rate as at 18 October 2015
** Source – Eurostat. For the year 2013, average net earnings – Romania
***Source – Australian Bureau of Statistics, for the year 2013-14 . Currency conversion – Bloomberg rates 31 December 2014

ING DIRECT to launch new upfront commission model

ING DIRECT has announced a new upfront commission model that will come into effect from 1 January 2016.

The simplified commission model will be structured around individual accounts as opposed to the current model’s focus on aggregator volumes and conversion rates, ensuring transparency for brokers and alignment with the bank’s primary bank strategy.

Mark Woolnough, Head of Third Party Distribution, commented: “We reward our customers for their loyalty and for supporting our business strategy to be the main bank for Australians. It made sense to do the same for brokers, resulting in our new, simplified commission model which will reward the type of business that best supports our primary bank strategy – lower LVR, Orange Advantage home loans.”

The minimum upfront commission will remain unchanged at 50bps (+GST) with the maximum increasing to 80bps (+GST) until 30 June 2016.

ING DIRECT’s new commission model was finalised following consultation sessions with aggregators and will apply on new residential loans with new to ING DIRECT security property settled from 1 January 2016.

ING Direct Lifts Mortgage Rates

ING DIRECT today announced it will increase interest rates by 0.18% p.a. across its variable owner occupier and investor residential loan portfolio, effective 15 January 2016.

As at 15 January 2016, the variable interest rate on the Orange Advantage offset home loan for residential owner occupier borrowers will be 5.02% p.a. (5.21% p.a. comparison rate).

ING DIRECT Increases Rates for Property Investors

ING Direct has announced they are increasing variable rates on existing investment property loans by 0.37%pa effective 5 November 2015. They had previously tightened investment loan criteria.

Existing customers who hold both owner-occupied and residential investment loans with ING Direct will not be subject to this interest rate change.

The current rates for new investment property borrowers remain unchanged.  ING Direct Orange Advantage is priced at 4.84%pa (5.03%pa comparison rate) for investors.

The bank has $38 billion in mortgages on book, of which about one third are investment loans, according to recent APRA data.