This year, Kiwibank celebrates its 20th birthday. Where did the bank come from and where is it going? 

Kia whakatōmuri te haere whakamua.

I walk backwards into the future with my eyes fixed on my past.

So much a part of the community now, Kiwibank was a very controversial intervention in the banking market at the beginning of the new millennium. If the concept for a local bank had not found a champion in the late Jim Anderton, Kiwibank would likely have been vetoed by the Labour-led government leadership. 

One tale of Anderton’s stubborn advocacy for the bank has become legendary. It’s the one the former deputy prime minister shared in his 2011 valedictory speech. A grinning Anderton cheerfully recalled the pivotal moment at a cabinet meeting when the proposal for a new, Kiwi-owned bank to address a lack of competition in an industry dominated by the big four Australian banks, became a plan.

“After months of exhaustive advocacy by me of the New Zealand Post business case for the bank – I had to knock down every objection, and they were multitudinous, one by one – Annette King finally turned to Michael Cullen, after three hours of this, and said these immortal words: ‘Michael, Jim’s beaten back every argument against the bank we’ve ever put up – for God’s sake give him the bloody bank!”. And Michael Cullen, in equally immortal words, said: ‘Oh, all right then’.”

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But there’s another part to the story, shared by the late Cullen himself in his 2021 memoir Labour Saving. Cullen confirms his scepticism of the bank as minister of finance and writes that official papers referred to “strongly competing advice requiring [the government] to exercise an especially high level of care” in approving New Zealand Post’s proposal for a new New Zealand-owned bank. 

But the conditions were met, the answer was yes, and Jim got his bloody bank. The Kiwibank Treasurer was given $65m to establish the bank which was invested in fixed interest securities (bonds and bank bills mainly) until the bank was ready to accept deposits and grant loans. Growth was fast and by the end of year five, the balance sheet was $4.7b and by 2011 Kiwibank had 700,000 customers. 

Anderton was proved right about the need for a local bank too, as Cullen goes on to write: “Kiwibank proved its real worth to New Zealand” when the global financial crisis arrived in 2007. The Australian-owned banks virtually bailed out of the mortgage market and the still-small Kiwibank stepped in, becoming the largest provider of new mortgages once the economy started to recover.

In the three months to December 31, 2008 Kiwibank lent $871m, more than quadruple the amount for the same period the year prior and more than six times as much as the biggest lender, ANZ/National Bank. With just a 3.3% share of the overall mortgage market Kiwibank was responsible for 66% of the new mortgages.

Kiwibank chief executive (CE) Steve Jurkovich recalls that time well – because he was working for one of the banks that bailed.

“The Aussie banks pulled up stumps and ran back to look after themselves and Australia,” he says. “So it was a little bit of every man for himself. The drawbridge was pulled up. I remember after the GFC when I rejoined the bank I’d been at, I had to go to customers and say, sorry, we were fair-weather friends. 

“I wasn’t here at Kiwibank at the time, so I can’t take any of the credit but Kiwibank did lend and grow really strongly. So, you know, that sort of proves Cullen’s point: if things get really rough, who’s going to be still there and operating?”

It would eventually be Cullen himself, the persuaded sceptic, who found a way to solve the problem Kiwibank’s growth created – the growing need for capital – by negotiating a deal for the New Zealand Super Fund and ACC to buy half of the bank from NZ Post, whose board he chaired.

Twenty years on, Kiwibank is a different company. It now serves a million New Zealanders and their businesses, and it no longer operates from Postshops. But it’s different in other ways too – a blossoming internal culture guided by a unique rautaki Māori is about to become more evident on the outside with the assistance of a refreshed brand direction including a new identity. And it enters a world where banking and financial services that couldn’t have been dreamed of two decades ago will be supported by a new cloud computing core.

Like his CE, Teaho Pihama has spent most of his working life in banking. He could hardly have imagined that when he joined Kiwibank in 2017 as a business manager it would lead to an opportunity to embed te ao Māori not only in the way the bank works but in the face it presents to the world. Since 2020, he has been Kiwibank’s head of Māori advisory.

“If we think of my role as somebody who is navigating Kiwibank on a journey, the journey is to build a much stronger and more meaningful relationship between what is essentially a Crown-owned entity and tangata whenua, to have a relationship with Māori in a way that is not a one-way street,” he says. “So there’s a trading of benefits between each other, rather than just an extraction of benefit one way. We are taking a really long term view on how we go about establishing this relationship. But at the heart of it, like any indigenous culture, the language and its customs are really at the heart of how we’re creating a strong foundation.”

Small changes along the way can be significant. Until recently Kiwibank referred to its work as “Kiwis making Kiwis better off”. But “Kiwi” is its own plural in te reo Māori – and Kiwibank was misusing the word at the heart of its brand. Pihama says that while he loved the sentiment of the slogan, he felt “this little niggle in the back of my mind, that gave me some reservations as to why I didn’t 100% engage with the purpose”. He realised one day at a bank hui that it was the word that was troubling him.

“I felt the first step we needed to take as an organisation was to use the language authentically. When I built up the courage to have the conversation with our leadership, I thought it was going to be a fairly difficult conversation to have. But when I laid out the rationale, and the reason and the feelings and the emotion behind it, it was unanimously supported across the wider Kiwibank leadership.”

Now, the bank’s purpose is not only distinctive but correct: “Kiwi making Kiwi better off.” Another change is pending: the introduction of bilingual signage at branches and more broadly across the bank. “We’ve gone through the process to date of polishing the inside of the paua shell,” says Pihama. “And now we’re going to start polishing the outside.”

The new signs will be aligned with changes being made as the bank introduces a modern new direction for the brand’s identity  – keeping the familiar green but replacing the fairly utilitarian Kiwibank brand with one developed from the ground up to tell the story of a bank trading in the modern world, but with an eye on its roots.

The new brand identity, which brings a shaded 3D look to the bank’s traditional brand elements, was inspired by the harakeke (native flax) plant. The “fold” which gives the new logo depth is modelled on the fold in the harakeke leaf, says Erica Beagley, Kiwibank’s head of brand.

“We had developed a new brand promise around the idea of enabling Kiwi to thrive and as we worked with our partners we learnt that the metaphor of the harakeke plant captured that idea quite beautifully. In the very centre, you have the young shoots, the rito, that symbolise our tamariki. Moving out, you have that protected by the more mature leaves, the mātua which are the parents, then you’ve got the grandparents, tīpuna, surrounding that.

“It’s a whole ecosystem and community working together. We loved that idea of kind of intergenerational thriving and everybody having a different role to play. The other thing about the harakeke is that you never see a plant in isolation – it’s always a little village or community of plants.”

While the rautaki Māori and the new brand direction have emerged from the heart of Kiwibank, other changes are driven from the outside. The rise of new financial services, cryptocurrency and innovative app-based “neobanks” all fed into the decision to buy a new cloud-native banking platform developed by the London-based company Thought Machine. The generational tech update is now being quietly rolled out through the organisation.

Jurkovich says the frustration of having an earlier plan to upgrade disrupted by the pandemic has turned out to be a bonus. Going with a solution from a revolutionary company – then a start-up founded by former Google engineers – would have been a difficult call two years ago. But since then, several market-leading international banks have adopted Thought Machine and he’s very happy to follow them.

“The world has changed,” says Jurkovich. “We’re on the fourth generation of the banking technology stack and it’s still pretty early. But all those services you’re talking about, they will be facilitated by the cloud, by AI, by machine learning, by being able to use APIs to access other people’s stuff. I think, in a sense, we’re really lucky that we’re going now and not any sooner, because I think we’re going to be on a really flexible, scalable technology.”

The self-confessed “banking nerd” believes changes in the market will lead Kiwibank to do business in ways and sectors that it has not before.

“One thing is that we’re so small compared to the others that we’re going to have to partner with those new companies. If you’re making a billion and a half dollars a year, you can probably convince yourself you can do it all yourself. When you’re our size, you know, you’re going to have to partner with people to bring these new products and services alive.”

“For some things, we will be the plumbing. There’ll be new innovative payment things, you know, whether it be crypto or whatever, and as a bank, we might be the one to bring a sense of safety to that for customers. We’ll also be competing with them. Let’s say, for example, people start using Instagram for payments, then we’ll need to be able to either facilitate those payments, or handle micropayments ourselves.”

It’s all a long way from when Malia Tu’ulima started with Kiwibank in 2002. She’d been working for an Australian bank for 17 years and had decided to try something else when her former boss, a member of Kiwibank’s startup team, asked her if she’d like to join the new venture. “I thought, you know, it would be nice to actually be part of a New Zealand bank, especially from day one, and just see where I go from here. But I didn’t expect to be still here after 20 years!”

Tu’ulima was offered a team leader role at the new bank, in recognition of her experience, but insisted on starting at the heart of the organisation, in the call centre. There were eight of them in the room and just one branch open. She took the third call – which was from that first branch, in Palmerston North.

“It was just a basic account query – we were there to assist them. The majority of the phone calls that I took on that first were from Glennis at Palmerston North branch. I think she just had a speed dial on Malia,” she laughs.

Tu’ulima has not only stayed with Kiwibank in a variety of roles, four of her five children have worked there too.

“I remember having a chat with Paul Brock (CE 2010 – 2017), he was a lovely man, and he said we might as well call it the Tu’ulima Bank. He asked me if I had any more children and I said I’ve got one more at college and he said you might as well put in his application!”

Jurkovich says the relatively flat management structure of the bank, which makes it possible for staff to chat with the CE in a way that might not be possible in a larger organisation, is valuable – and he likes a natter himself.

“I’m an absolute extrovert. I get energy from being around people. One of the things I found hard about lockdown was working by myself in a room,” he says. 

“Those people that have been around for 20 years, it’s really cool to talk to them. There are also team members that have been with the bank 15 years, but worked for New Zealand Post for 20 years before that. They’ve got really deep roots in the broader company. That’s pretty cool.”

He, too, reaches for the idea of whānau when talking about the bank’s purpose and its future at the 20 year mark.

“I grew up in a house with a solo mom who worked three jobs, and we had no money. But she also never talked about money. In a household where money isn’t talked about, it’s really hard for kids to feel confident about it, even really basic stuff like, pay off high interest debt as soon as you can, or if you put a little bit away for a long time, it ends up being a decent amount – the power of compounding interest, both good and bad.”

He wants Kiwibank to become a force for financial literacy. He wants young New Zealanders to start conversations about money, about their financial future to empower their decisions.

His own daughter, at 21, is a year older than the bank he runs.

“At that age, you’re nowhere near the finished product. There’s lots of stuff that hasn’t happened for her yet. But she’s got a pretty clear view of where she’s come from,” he says. 

“I feel like that company-wise we’re a bit the same: 20 years to get to where we are, a million customers, $30 billion in assets. That’s great. We should look back and go, look how far we’ve come. Our original Kiwibank team members, 20 years on, they’re not the same people they were and we’re not the same company. There’s a big opportunity now we’re in our twenties, a great launching pad.”