ASB: Changing the way we do business to back the change-makers

The world is rapidly changing. We are on the edge of major technological advances that will transform the way we live and work. Global population growth is driving food demand and climate change is impacting traditional food production and where and how we live in rural and urban areas.

In Aotearoa New Zealand, we have a housing crisis, an ageing population and declining productivity that urgently needs our attention if we are to maintain our great Kiwi lifestyle and quality standard of living.

We all have a role to play in shaping our collective future. At ASB, we are changing the way we bank, to help New Zealand and New Zealanders meet these challenges and deliver a better tomorrow.

Recognising the unique role a bank can play in supporting a country’s progress, financial, social and environmental outcomes are being built into everyday decisions and long-term planning.

The Business Banking team banks one in five businesses in New Zealand. From sole traders and small family businesses to large-scale manufacturers and exporters, innovative food and fibre producers, farmers and rural customers, to Māori and iwi-led organisations, there are business relationships across the whole economy.

The role is to help customers embrace change and grasp the opportunities that lie ahead, and that means adopting a more flexible approach to lending.

Take for example, New Zealand’s food and fibre sector. Built on a special relationship with the land, founded on kaitiakitanga, care and respect, the sector is vitally important to the economy.

Food and fibre accounts for around 80 per cent of our merchandise exports and has a strong global reputation for sustainability, food safety and world-changing food innovation.

But reaching consumers offshore is capital intensive and, alongside a great product, requires connections, contacts and expertise.

ASB ACCESS supports high-potential food and fibre businesses to scale and embrace international market opportunities.

These companies include plant-based jerky producer Off-Piste Provisions; sustainable packaging provider Grounded, which offers plastic-free options for the food and consumer goods industries; Lilo Desserts, a circular business that turns imperfect fruit into value-add desserts; and Almighty Beverages, which is motivated to help support better drinking decisions through its healthy, clean beverages.

To support these early-stage companies, it means taking a broader assessment beyond simply looking at balance sheets to recognise the future potential if they are supported to scale at the right time. Alongside working capital facilities, participants will receive tailored trade support to ensure they can take advantage of export opportunities.

Jade Gray, founder of Off-Piste Provisions, says there is a mutual interest and desire to grow the food and fibre sector and that’s exciting because it has huge potential for New Zealand. He adds that the programme engages with innovative and creative solutions for a startup that has unique and unconventional needs, and a willingness to share that risk and go on that exporting journey.

Alex Worker, founder of Lilo Desserts, says the programme has helped them build up a strategic working capital facility that’s enabling their export strategy faster than what they could have done with other banks, or through dilutive equity fundraising in the current climate.

Another area of focus is housing. With around 30,000 people on the social housing waitlist, there is an urgent need for more homes to be built. Feedback from the residential property sector says the lending metrics were getting in the way of the development of affordable housing. To be an enabler of housing development and investment, the bank decided to think differently about how to lend.

The $500 million Accelerated Housing Fund supports the development of affordable housing, investment in social housing, and a portion of the fund is earmarked for Māori housing development and investment. Lending metrics and criteria were adapted to help get projects off the ground quicker and increase the access to and supply of houses.

Community housing providers, private developers and industry bodies have all reacted positively to the fund, which has so far committed lending for several developments across affordable, social and Māori housing. By supporting the delivery of up to 1,000 new homes over two years, that could see around 4,000 New Zealanders living in warm, dry, healthy homes and building thriving communities.

Underlying many of the challenges we face is New Zealand’s poor productivity performance. New Zealanders are working longer and producing less than counterparts overseas. We need to take action to ensure the future sustainability of providing essential services such as health and education.

Business should lead the charge by being more ambitious, embracing technology, adopting an international focus, and working together and sharing resources to drive innovation.

Business lending for productivity has been created to encourage and give confidence to leaders to make productivity investments and future-proof their business. As an extra incentive, business customers that take out this lending may be eligible for a productivity grant, paid at 1 per cent of the loan, up to $50,000.

Through this lending, customers have been supported to, among other things, extend their manufacturing facilities, centralise operations to improve efficiencies, and purchase machinery to increase product range and quality.

The bank is walking this path of change alongside customers and as a result, is more flexible, future-focused and determined to make a difference where it matters most for all New Zealanders.

ASB Bank Limited’s lending and eligibility criteria, terms and conditions, rates and fees apply. Offer is subject to change and may be withdrawn at any time.