Good morning all,
and welcome to my April Digest, I hope you are all well. We have now passed step 2 of the roadmap out of lockdown, hopefully you have all been able to enjoy something linked to the easing of restrictions, be it seeing family, a trip to the shops, the gym, the hairdressers or a beer garden. Your high streets are back open and you are back to your normal hours, and hopefully you are seeing an increase in customers as they too return to some normal habits.
I will cover the usual topics in this month’s digest, I hope you enjoy it, please let me know if you have any queries.
Savings
I will start with savings, and despite what I have said above about only just coming out of lockdown, we have had a storming start to the year despite the restrictions. By the time you read this we will have surpassed 100,000 new savings accounts as a group, bringing in over £3bn new money. The agency network has opened c.20,000 of these, which has seen your net balances increase by £166m. This is growth of 3.3% and virtually all of you have seen your own balances grow which is great news.
As you will see below, a high proportion of the 20,000 accounts you have opened and new money brought in has come from our new loyalty range, the success of which has exceeded expectations. I explained last month that the main aim of our loyalty proposition was to reward our members in the true spirit of mutuality, but the increased balances have been a happy by-product of this and it has continued to be the case. Fixed rate retention has also been very strong all year, which obviously helps with the net balance growth.
This strong start to the year and our brilliant lending performance (predominantly through Accord), has meant we have readjusted our savings growth aspirations and increased our ambitions for 2021. How are we going to do this and how can you benefit? Put simply more of the same!
Firstly we need to maintain the strong retention performance. We are launching further loyalty products, next is a non-ISA six access saver, then another exercise to ‘raise the floor’. Later in the year we will be offering a charity bond, and prize draw accounts. All of these propositions on the back of eased restrictions should give you opportunities to discuss customer savings elsewhere and attract new funds.
The 2 circles in red above are a reminder that we do still need to maintain focus on non-fixed rate retention, and also utilise the opportunities that our recently introduced outbound calling strategy can bring. Our branch network has seen some brilliant results from this activity over the past 12 months, and now you have the opportunity to do the same. Again last month I shared that some of you have really embraced this, but others are missing out on opportunities to attract and retain. The first half of the month provides calls to follow up mailings on the following areas, although you can of course widen the conversation with these customers to address any savings needs:
Mar – 20/21 ISA top up calls
April – 21/22 ISA tax year start calls
May – re-engage with customers on loyalty products
You will see that in May we will be providing an opportunity for you to re-engage with some customers who have opened a loyalty product during the restrictions when there was less opportunity to widen the conversation. The selection process will provide you with the best opportunities of speaking to customers with money elsewhere.
I know that some of you have encountered system issues, so I am looking at the option of providing the call data manually (like we did last year) so you don’t miss out.
Mortgages
The mortgage market has been very buoyant, and residential application volumes saw a steady increase throughout March and April. The increase in activity has been led by purchasers, while re-mortgaging has dropped. First-time buyers are accounting for 38% of all applications in the market, the highest level recorded in the history of the residential CACI MARS service.
People are borrowing more too and there has been a notable change in the average application value, which rose from £210,000 to £219,000 across the UK. Last week saw the introduction of the Mortgage Guarantee Scheme with Halifax, Barclays, HSBC, Lloyds Bank, Royal Bank of Scotland, Santander and NatWest all re-entering into the 95% LTV tier under the scheme.
I mentioned that Accord have started the year strongly, in part but not exclusively due to our early involvement in the 95% space, and our direct performance has also been steady with over 300 appointments booked by the branch network. Agency referrals are not really reflecting the market buoyancy or our lending performance with just a couple a week on average across the whole network. We are still working on both improving the referral process to make things easier for your teams and customers, and also refreshing some training material later in Q2.
Network Updates
CAB/Ventures
I wanted to take some time to introduce to you the Ventures Team and the projects they are currently delivering. The Ventures Team was formed in December 2019. The team design and deliver new purposeful and commercial opportunities to help customers and sustain YBS for the next 150 years. The team are currently working on the Citizens Advice Bureau (CAB) pilot, which is really exciting. It sits right at the heart of our purpose - Real Help with Real Life, as CAB are focussed on helping people find a way forward, when they need it the most. They’re hopeful it will attract new customers to walk through our branch doors too. The whole team are looking forward to seeing how this venture pans out when it’s launched next month in ten of our branches. The branch teams involved in the pilot will get to meet their CAB adviser over the coming weeks, and all branch and agency teams will be given more information about the CAB in a Retail Brief scheduled for Wednesday 12 May.
Workplace Savings
I’d also like to make you aware of a new proposition that we are currently testing in the market called Workplace Savings, and which a few of you have already spoken to our Development Manager Sam Wilkins about.
Did you know that in the UK, 11 million people are non-savers, and 7.5 million of these are in employment. At YBS we’ve been talking about the challenges we have across society regarding short term emergency savings, why it’s important to employers and how they can help employee’s wellbeing in this space. We’ve been working with local employers through our retail distribution outlets with ways we can help. Workplace Savings is simply a way of allowing employees to save direct from salary so you don’t even need to think about it. Straight into an account with no costs or fees involved. If you’d like to know more about how you can help your colleagues, you can look through our website or contact Sam who’d be happy to talk about it in more detail.
Passbook Trial
You will now be using a combination of both traditional passbooks and passbook record cards which were introduced earlier this month – this was in part due to us running into stock issues following the success of the loyalty products. Independently of this, we had also been reviewing our passbook offering. On 12 April we began a six week trial at twenty branches and agencies, giving new customers to YBS the option of whether they take any kind of passbook when they open a passbook based account. This was because research had shown a significant number of customers issued with a passbook when they opened an account with us rarely use it again. We are now expanding this experiment to existing customers opening new accounts. Those of you involved in the pilot will already be aware of this, and for others, this means you may see an increase in the flags being added onto accounts.
Net Promoter Score
Last month I talked about this in the context of our group ambitions to improve our score this year, and also how well agencies perform in our transaction NPS measure. I know your DM regularly shares the scores and comments for your agency with you, at the end of our NPS surveys, our customers also get the opportunity to single out any particular colleague they believe deserves a special mention for providing outstanding service. I wanted to share some fantastic examples with you from Q1.
Firstly, Sarah Preston from one of our newest agencies - St Neots - who received no fewer than ten flags during the quarter. One customer said Sarah has been helpful for the many years her family have been members of both N&P and YBS. Two other colleagues managed to receive ten flags during the quarter – well done to Tracey Richardson in Evesham and Susan Carr in Wilmslow. Susan was described as an ‘exceptional member of staff who was very knowledgeable but without ever pressurising you into a decision’, and Tracey was described succinctly as ‘excellent’. Great to hear!
Wilmslow and Bournemouth made it into the top 10 of branches and agencies for Q1 with 24 & 17 green flags respectively. Well done to all in those teams.
Community
Here’s an update from our Community Engagement Manager, Naomi Hockney.
Small Change Big Difference:
Age UK:
I hope you enjoyed this month’s digest, as ever if you have any feedback or requests for topics, please feel free to get in touch. Have a great bank holiday weekend.
Thanks,
Dave