Brokers play vital role in bank that 'does things differently'
The new CEO of Heartland Bank Australia has revealed that she was attracted to the role because of the organisation’s growth aims and its eclectic product offering that differed from other banks.
Michelle Winzer, the former chief executive of RACQ Bank and the Bank of Melbourne, was appointed CEO of Heartland Bank Australia back in April but her official tenure began on July 22.
The bank, which is based in Melbourne but also has teams in Brisbane and Sydney, was created following the decision of New Zealand financial services company Heartland Group, which owns Heartland Bank New Zealand, to acquire Australian digital bank Challenger.
Heartland Group already operates Australian reverse mortgage business Heartland Finance and livestock finance company StockCo Australia. These two businesses were added to Challenger to form Heartland Bank Australia.
Winzer has notched up more than 30 years in the banking industry. As well as her CEO roles at RACQ and Bank of Melbourne, she has worked in various roles at CommBank, Bankwest and Westpac across almost every aspect of the sector – retail and business banking, contact centres, operations, and distribution.
Speaking to MPA, Winzer said the move from big banks to being CEO of RACQ, a member-owned bank with 1.8 million members, had been really interesting.
“It’s a totally different business model and way to run the business,” Winzer said. “You have to be across everything and it’s only a small team – 150 people … I loved it because you can really wrap your arms around the whole business, get really close to your members and move a lot faster than you can in the major banks.”
Winzer said making the move to Heartland Bank Australia had also been an interesting opportunity that brought together all her past career experience.
“I didn’t really want to do something else that was the same as I’ve done previously and this [role] gave me a really different opportunity,” she said.
“It‘s a very different eclectic mix of products that we offer. It's a really exciting strategy of offering best or only solutions, with products that people can't easily get elsewhere and I love that.”
Winzer said she loved the diversity of the role, having to learn new things and the fact that Heartland Bank Australia is a growth business.
“We’re really keen to continue to acquire and bring on other different businesses.”
Michelle Winzer’s focus on brokers
It’s clear Winzer is a strong supporter of the broker channel – during her time at RACQ Bank she went to the board and gained its permission to set up a broker distribution channel in Queensland. Prior to this RACQ operated a direct to customer model only.
“It was hugely successful and one of the things I was really proud of,” she said.
At Heartland, Winzer said the bank had strong, well-established connections with brokers for its reverse mortgage business and “we’re looking at new ways to support these”.
“Because we’re a digital bank, brokers like having slick, efficient processes.”
The bank also has partnerships with introducers and brokers connected to its StockCo business, a market leader which provides financing to farmers for beef and sheep from birth. Heartland retains a lien over the animals as security and the bank is repaid when the cattle or sheep grow to full size and are sold.
“We have these relationships today [with brokers and introducers] and we see that as a really important part of the business – we’ll continue to grow and build on that.”
Winzer said already some thought had gone into the possibility of introducing new StockCo products that Could help people in different ways.
When it came to the Challenger digital bank side of the business, Heartland’s focus remained on deposits and term deposits.
Asked if the bank would offer home loans in the future, Winzer said Challenger already had a small “legacy” home loan book but she did not think home loans was something the organisation would pursue.
“If we go back to our strategy to offer best or only of their kind products, home loans is a really competitive space … we acquired Challenger because it’s important to have the ADI, that gives us the Australian banking licence but it also give us the retail deposits to support our growth in the other businesses.
“I’d expect we would probably get into other product sets before we think about home loans.”
Winzer said Heartland already offered asset and auto finance in New Zealand and had indicated to the market it was interested in bringing that into Australia.
Trans-Tasman operations
Heartland Bank’s origins in New Zealand date back almost 150 years and Winzer said the Australian bank was fortunate to be owned by the NZ bank and draw from its many years of experience.
She said there are a number of shared services that operate across both New Zealand and Australia. The Australian bank also gets its capital and backing from the New Zealand business.
However, regulators across both sides of the Tasman had made it clear that Heartland Bank Australia must operate as a separate, standalone entity.
“I have my own board and we make the decisions for the Australian bank,” Winzer said.
“We do have representation from the New Zealand bank and the Group on our board and that’s really important that we work closely and learn from each other but we operate the business here in Australia on our own and make the right decisions with the board for the Australian business.”
Growth objectives
In Australia, combining the three businesses – the bank, StockCo and Heartland Finance reverse mortgages had been about “ensuring we’ve got the right people in the place” to support growth and had resulted in greater efficiency and economies of scale.
Last week, Heartland Bank Australia appointed Medina Cicak as its new chief commercial officer and the bank has also been named an excellence awardee (finalist) in the Infiity Capital Financing Group Bank of the Year at the 2024 Australian Mortgage Awards.
Winzer said Heartland Bank Australia had strong growth objectives across all of its product offerings in the next three to five years.
“We think that there's a market, there's a need and there's and we have an offering that is really attractive. We’re going to do everything we can to achieve it.”
Heartland has written 27,000 reverse mortgages and has 40% of the Australian reverse mortgage market. Winzer said with Australia’s ageing population there were a lot of people who needed access to finance.
“They've got an asset that's grown in value, but they haven't necessarily got access to cash to do things to support them. They want to age in their home, but they can't necessarily afford those things.
“There’s a real need for us with the solutions we offer and we're going to work hard on growing and helping more Australians:”
Winzer’s take on leadership
Asked about her leadership style, Winzer described herself as “a genuine, authentic, visionary leader”.
“I love to create a great culture where people love to be part of it. I'm future focused and love the growth opportunities.
“But the biggest thing about my leadership style is that I have very strong focus on the people in our business and think that if we create a culture where people can achieve their potential, then all of our customers get the benefit of that. My legacy will be, I think, delivering strong growth because of the impact that I’ve had with our people.”
Winzer said Heartland Bank Australia did not want to mimic others..
“We actually want to do things that are different to others and I think it's a space that we're doing well in and we can continue to own.”
