Commonwealth Bank boss Ian Narev has set out his vision for Australia’s largest bank but refused to put performance targets on his key aims.
Almost five months after taking over from Ralph Norris, Ian Narev pinpointed return on equity, stable dividends to shareholders and customer satisfaction as his key performance areas.
But in a strategy briefing to analysts and media, Mr Narev was reluctant to put specific performance targets on those areas, with the exception of being number one in customer satisfaction.
“Internally, we are going to be setting very clear benchmarks against each of these metrics,” he said.
“What we are not going to be doing is setting targets, particularly for the long term.
“And the reason we’re not going to be doing that … is the fact that we are in very volatile markets.
“The last thing that we want to be doing when we are in an institution, managing it for the long term, is start doing unnatural things in an environment because of some number we put out there two or three years ago.”
Several analysts had been seeking tangible performance targets from Mr Narev.
“We were a little disappointed there was no guidance or target on the cost efficiencies to be won through higher productivity,” Morningstar analyst David Walker said.
Technology improvements would be made to boost efficiency within CBA and improve its customer relationships, Mr Narev said.
Costs would also be cut to improve the bank’s earnings, although a commitment was made of no jobs being sent offshore.
CBA’s presence in Indonesia would continue to expand as conditions allow but no plans were given for any significant expansion into other parts of Asia.
“Whichever way you look at this strategy it is still primarily and above all an Australia story,” Mr Narev said.
He also indicated there was unlikely to be any significant mergers or acquisitions (M&A) made by CBA in the near future.
Prior to CBA’s $373 million takeover of Count Financial in November, 2011, its last major acquisition was the $2.16 billion BankWest purchase in 2008.
“I am by no means here saying to you that over the next three, five or 10 years we will never do M&A,” Mr Narev said.
“What I am saying is that we have a very high bar and strong disciplines associated with that.”
CBA shares closed steady at $50.78.
