09/708

DECISION

Meeting 9 December 2009

Complaint 09/708

Complainant: K. Summerfield & Others

Advertisement: ASB Bank Limited

Complaint: The website, billboard, newspaper, in-store and bus advertisements all
contained the following:

“WE’VE BEEN A
KIWI BANK
SINCE 1847.

1847 2009
_________________________________________________ ASB
Keeping NZ one step ahead.”

Complainant, K. Summerfield, said:

“Type: Website
Where: Please see attachment
Who: ASB Bank
Product: themselves

Complaint -
No advertisement should be misleading or deceptive or likely to mislead or deceive
the consumer.

Hello! Trust all is well. I couldn't help notice this (see attachment) on ASB Banks
website.

I guess there are 2 issues I have concern with.

1. The use of the text 'KIWI BANK' within the sentence of "We've been a KIWI BANK
since 1847'
I'm sure you're familiar with the bank Kiwi Bank, and it seems very odd too, in the
middle of a sentence start CAPITALISING WORDS if you know what I mean.
 2 09/708

2. I was under the impression ASB Bank is Australian owned and while saying they
were a 'kiwi bank' rather than a 'New Zealand bank', it still creates what I believe to be
a false impression”

Duplicate Complainants raised similar concerns about the advertisement.

The Chairman ruled that the following provisions were relevant:

Code of Ethics

Basic Principle 4 All advertisements should be prepared with a due sense of

social responsibility to consumers and to society.

Rule 2: Truthful Presentation - Advertisements should not contain any

statement or visual presentation or create an overall impression which directly
or by implication, omission, ambiguity or exaggerated claim is misleading or
deceptive, is likely to deceive or mislead the consumer, makes false and
misleading representation, abuses the trust of the consumer or exploits
his/her lack of experience or knowledge. (Obvious hyperbole, identifiable as
such, is not considered to be misleading).

Code for Financial Advertising

Basic Principle 3: Financial advertisements should strictly observe the basic

tenets of truth clarity and should not by implication, omission, ambiguity, small
print, exaggerated claim or hyperbole mislead, deceive or confuse, or be
likely to mislead, deceive or confuse consumers, abuse their trust, exploit
their lack of knowledge or, without justifiable reason, play on fear.

The Advertiser, ASB Bank Limited, said:

“Thank you for the opportunity to comment on the complaints received by the
Advertising Standards Authority (ASA) and now consolidated as Complaint 09/708.

Complaints

Our review of the complaints shows there are two main areas of concern held by the
complainants. These are:

1) that the reference to ASB being a 'Kiwi bank' is a claim by ASB of New
Zealand ownership; and

2) that pointing out that ASB is a Kiwi bank is confusing given the operation in
New Zealand of Kiwibank Limited.

Kiwi bank vs Kiwi ownership

From the outset I would like to set the record straight and confirm that we have not
stated or suggested anywhere in our advertising that ASB is 'Kiwi owned'. That ASB
Bank Limited's ultimate owners are the Commonwealth Bank of Australia and its
shareholders (many of whom are New Zealand residents) appears to be well
 3 09/708

understood by the complainants, partly no doubt because ownership is an issue a

competitor has sought to target in its marketing campaigns for a number of years.

However, being a Kiwi bank is not about ownership and it is incorrect to approach the
ASB advertising with this focus. Being a Kiwi bank is about your provenance, the way
you think and act as an organisation, your history and your commitment to staff,
customers and the community, Focusing on ownership ignores the fact that ASB is a
New Zealand incorporated company that exists because of its community, customers
and staff, all of which are Kiwi. Viewed objectively, an ownership focus clearly is
illogical - for example, if ASB is not "Kiwi" then would the Bank of New Zealand need
to change its name?

In addition to the fact that it is a New Zealand incorporated and registered bank, ASB
has the right to claim it is a "Kiwi bank" for the following reasons:

 The ASB banking undertaking has been serving New Zealand communities for
over 162 years
 Established in 1847 to answer a community need
 Employs over 5,000 passionate Kiwis
 Provides a full range of financial services to over 1 million New Zealanders
 Works with over 6,000 supplier companies in New Zealand
 An autonomous bank with its own Board and decision making powers. We are
not a branch of Commonwealth Bank and do not have branches in Australia
 Our financial products are designed in New Zealand for New Zealanders and
we provide services to Kiwis throughout the country
 We work with and support many and varied New Zealand organisations. We
provided $10m worth of support to the community last financial year alone
 ASB has not sent any jobs off shore
 ASB has made a large commitment to New Zealand's economic recovery from
the recession through the provision of the $1 bn Job Creation Fund
 ASB is a leading provider for Kiwis' futures through its role as a KiwiSaver
scheme provider
 Virtually 100% of ASB lending activity remains within New Zealand

The ASA Complaints Board has previously considered a similar complaint regarding
ANZ Bank and its claim to have been New Zealand's first bank (Decision 041027).
The Complaints Board when considering that claim did not focus on the ownership of
ANZ but looked at the fact that ANZ (in its original guise) had opened in New Zealand
in 1840. The Board recognised that the lineage and history of that bank as an
undertaking is what was relevant to the truthful presentation of the message.

It is our place in New Zealand that is relevant. We believe this approach has been
endorsed by the ASA Appeal Board when reviewing the history of Instant Finance
(Decisions 06/461 and 07/007) where, despite structural changes to operating
companies, the history of the business was recognised and accepted.

ASB readily accepts that the advertisements could be described as "a bit cheeky":
their intention was to get people talking. They provide the platform for ASB to tell
people about its history, values, strength and services. ASB has received a lot of
feedback in support of the advertisements from customers and non customers alike,
 4 09/708

many of whom have noted that ASB has a long and proud tradition as a New
Zealand bank supporting New Zealanders.

Confusion with Kiwibank Limited

The second aspect of some of the complaints is that the use of the phrase 'Kiwi bank'
could create confusion with Kiwibank Limited. We do not consider there is any risk of
confusion arising from the advertising complained about and certainly have not seen
any confusion as a result of the advertising.

The advertisements clearly represent ASB with the same unique colour range, font
style, and logo positioning that is usually utilised by ASB. We have a prominent brand
that is recognisable for these reasons. It is notable that the complainants who have
approached the ASA are not actually complaining they were confused.

The words 'Kiwi bank' are two words that form part of a sentence which is clearly
attributed to ASB.

Advertising Standards Codes

In addition to our comments above we have responded separately to each Code, Rule
and Principle raised by the ASA in its letter.

Advertising Code of Ethics - Rule 2

Truthful Presentation - Advertisements should not contain any statement or visual

presentation or create an overall impression which directly or by implication,
omission, ambiguity or exaggerated claim is misleading or deceptive, is likely to
deceive or mislead the consumer, makes false and misleading representation,
abuses the trust of the consumer or exploits his/her lack of experience or knowledge.
(Obvious hyperbole, identifiable as such, is not considered to be misleading.)

We consider that the statement "WE'VE BEEN A KIWI BANK SINCE 1847" is
accurate and a truthful presentation of ASB. There is no ambiguity in what is clearly a
strong message promoting ASB's provenance and history in New Zealand. That
statement is just one element of a significant campaign ASB has devised to
communicate the ASB points of difference; namely our legacy, people and
commitment to the New Zealand communities in which we operate. As you can see
from the attached representative sample of our overall campaign we are proud of
our role and history in New Zealand and highlight these facts.

Advertising Code of Ethics - Basic Principle 4

All advertisements should be prepared with a due sense of social responsibility to

consumers and to society.

The complaints focus on one execution of a wider campaign centred on ASB's legacy
and community involvement.

We have not claimed ownership by New Zealand shareholders, but rather are
seeking to remind the public that ASB was founded on social responsibility, we have
 5 09/708

been around for 162 years and during that time have served the community ethically
and responsibly and continue to do so.

The campaign in its entirety has been thoroughly researched to ensure our claims
are honest. As always, our campaign goes through a rigorous process of
development and signoff.

Basic Principle 3 - Code of Financial Advertising

Financial advertisements should strictly observe the basic tenets of truth and clarity
and should not by implication, omission, ambiguity, small print, exaggerated claim or
hyperbole mislead, deceive or confuse, or be likely to mislead, deceive or confuse
consumers, abuse their trust, exploit their lack of knowledge or, without justification
reason, play on fear.

The advertisement in question is a brand advertisement and does not give any false
or misleading information regarding any financial product or service. ASB's corporate
representation is clear as per comments above.

It is widely known that ASB is owned by Australian interests. That has been
reinforced to the public by an extended campaign by one of our competitors. There is
no implication or ambiguity to the contrary that is likely to mean consumers would be
misled. The advertisements are simply a clever, but transparent, "play" on a
competitor's brand position.

Conclusion

ASB is proud of its place as a Kiwi bank and our role in New Zealand communities.
We have embarked on a journey to tell our story in a way that is witty, yet truthful and
responsible. ASB asks that complaint 09/708 should not be upheld.”

The Agency, TBWA\Whybin, said:

“In response to your letter regarding ASB Bank Complaint 09/708.

I am going to provide a general statement to refute the basis of the complaint from K.
Summerfield and 11 other complainants.

ASB Bank has been a client of TBWA\Whybin for more than a decade. During this
time ASB has always instructed the agency to be truthful and honest; in fact, we
have on all occasions been asked to veer on the site of caution when it comes to
making claims and statements etc.

ASB is an ethical and principled organisation and does not condone misleading or
mischievous behaviour.

The background to this is simply that due to a recent aggressive campaign, Kiwibank
has positioned all other banks as being 'non New Zealand'. Whilst other banks such
as Westpac (which began as The Bank of N S W ) , ANZ and others obviously have
strong Australian ties, ASB does not. ASB was founded by New Zealanders and has
served, as these advertisements say, the community since 1847.
 6 09/708

In this manner it has been providing banking financial services and banking facilities
for Kiwis for over 100 years. It has always been a 'local' bank. Its heritage is the
Auckland Savings Bank.

In considering a new campaign at a time of financial uncertainty, the agency believed

that ASB's history was extremely relevant. The fact that this bank has been operating
since 1847 is something ASB are proud of and we needed to communicate that.
They're also proud of the fact that they have a local call centre and have a branch
network all staffed by Kiwis. ASB in fact employs over 5000 people.

This campaign was conceived to Highlight ASB's history and in so doing emphasise
their involvement with New Zealand and Kiwis.

Whilst I accept that there is another ‘Kiwi Bank' which has used its local ownership as
its point of difference, I don't believe that it gives them the sole right to claim any
aspect of being Kiwi.

Kiwi is a descriptor for the population of New Zealand. We are all Kiwis, This is a
bank that serves all New Zealanders therefore it is absolutely reasonable to describe
it as such. The fact that the bank is wholly owned by the Commonwealth Bank of
Australia is not relevant. We have made no attempt to hide this, as it is not part of the
campaign.

This is not a campaign regarding ownership or claiming ownership. It is a campaign

designed to reinforce the important part ASB Bank plays in the lives of Kiwis, and
that was the intent and focus.

We also completely refute some of the other areas canvassed by the complaints
relating to decisions being made off shore. ASB operates as a stand-alone entity and
we have certainly never been asked in a communications sense to follow any
directives from Australia or from CBA. We are not privy as to now the ASB's profits
are repatriated we are merely involved in producing their communications. Again I
would stress ASB are a good employer, a reputable company and have never
directed us to produce any campaign with an element of deceit or misinformation.

The advertising simply sets out to state the truth, which is that ASB has been a bank for
New Zealanders (Kiwis) for an awfully long time. It was not an attempt to mislead,
and it is why we have a timeline as part of the ads showing from 1847 through to
2009, and the tagline “'Keeping New Zealand One Step Ahead”. It is simply about
pride in our history and pride in our heritage; at times of financial uncertainty this
stability and track record is important and this is what we have been attempting to
communicate.

Lastly, I would say that if we begin to suggest that Kiwi Bank somehow has special
rights to the word Kiwi, I believe we are entering very dangerous territory, which we
certainly would challenge.”

The Media, The Dominion Post, said:

“Thank you for your letter regarding the above complaint.

 7 09/708

We understand the complaint and reference to the Advertising Codes of Practice,

Code of Ethics - Basic Principle 4, Code of Ethics - Rule 2 and Code for Financial
Advertising - Basic Principle 3.

We would be interested to get your ruling on the use of the words 'kiwi bank' in this
context. Does the 'kiwi bank since 1847' refer to the ASB's beginnings as the
Auckland Savings Bank? Is there a copyright on the use of the words kiwi and bank
together with the establishment of Kiwi Bank?

My understanding of this ad is the connection back to ASB starting as a local

Auckland, New Zealand bank. If ASB only trades in New Zealand (i.e. does not
operate in Australia) the claim could be supported.

The emphasis on being a kiwi bank is obviously in competition to Kiwi Bank and how
others can use these words, and the words be used in a competitive context by
another back, needs to be clarified.

We would welcome your feedback and decision based on the information provided.”

The Media, The Christchurch Press, said:

“Further to the above complaint from K. Summerfield and 9 other complainants

regarding the placement of an advertisement for "ASB Bank", listed below are
relevant details pertaining to the advertisement.

1) Your correspondence relates to a complaint by K. Summerfield and 9 other

complainants concerning "ASB Bank We've been a Kiwi Bank since 1827"
advertisement published in "The Press" October 21St 2009
2) In accepting the booking, it did not appear that the advertisement may have
breached the Advertising Codes of Practice
Code of Ethics- Basic Principle 4
Code of Ethics- Rule 2
Code of Financial Advertising- Basic Principle 3
3) We await the findings of the Complaints Board and will adhere to their decision.

I hope these comments help you to resolve this matter, however should you require
any further information please do not hesitate to contact me.”

The Media, APN Outdoor, said:

“This campaign is clearly a tactical response to the marketing activity initiated by

Kiwibank. Retail banking is becoming increasingly competitive. ASB have been in NZ
since 1847 and for most of that time in NZ ownership. We feel that the statement
'We've been a KIWI BANK since 1847' doesn't attempt to deceive about it ownership
but rather it focuses on the fact that it has been a significant and well respected bank
in New Zealand for a considerable amount of time. And as such, very much a Kiwi
bank.

We do not feel it is breaching any code.”

The Media, iSite Media, said:

 8 09/708

“This letter is in response to your letter regarding ASB Bank Website, Billboard,
Newspaper and Bus advertisement - Complaint 09/708.

iSite Media have the ASB advertisement on our bus backs and billboards with the
campaign starting in November. iSite Media saw no reason not to place these ads
on their panels and sites, as we understand the message that ASB is trying to get
through to its audience. We take the advertising to mean that they are a bank
operating in a New Zealand market, serving New Zealand customers-therefore a
"Kiwi" bank.

They do not refer to themselves as a 'New Zealand owned' bank, merely that they
are "Kiwi" therefore we did not deem they were meaning to imply so.

Should you have any further questions please do not hesitate to contact me.”

Deliberation

The Complaints Board read carefully the relevant correspondence and the
advertisement which appeared in range of media.

It noted Complainants, K. Summerfield and Others were of the view that the ASB
Bank advertisements were misleading where they said:

“WE’VE BEEN A
KIWI BANK
SINCE 1847.”

The issues raised in complaint were that ASB Bank was Australian owned, and “Kiwi
Bank” implied New Zealand ownership, and also that the use of “Kiwi Bank” could
mislead consumers into connecting the ASB Bank with New Zealand owned
Kiwibank.

The Chairman directed the Complaints Board to consider the complaint with
reference to Basic Principle 3 of the Code for Financial Advertising.

Procedural note: The Complaints Board agreed that as the advertisement was for
a bank, in this case the Code for Financial Advertising was the most appropriate
code and consideration under the Code of Ethics was not required.

The task before the Complaints Board was to determine whether the advertisements
strictly observed the basic tenets of truth and clarity and did not by implication,
ambiguity, or hyperbole mislead, deceive or confuse, or be likely to mislead, deceive
or confuse consumers, or exploit their lack of knowledge.

The Complaints Board noted the Advertiser’s response where it said:

“…In addition to the fact that it is a New Zealand incorporated and registered bank,
ASB has the right to claim it is a "Kiwi bank" for the following reasons:

 The ASB banking undertaking has been serving New Zealand communities for
over 162 years
 Established in 1847 to answer a community need
 9 09/708

 Employs over 5,000 passionate Kiwis

 Provides a full range of financial services to over 1 million New Zealanders
 Works with over 6,000 supplier companies in New Zealand
 An autonomous bank with its own Board and decision making powers. We are
not a branch of Commonwealth Bank and do not have branches in Australia
 Our financial products are designed in New Zealand for New Zealanders and
we provide services to Kiwis throughout the country
 We work with and support many and varied New Zealand organisations. We
provided $10m worth of support to the community last financial year alone
 ASB has not sent any jobs off shore
 ASB has made a large commitment to New Zealand's economic recovery from
the recession through the provision of the $1 bn Job Creation Fund
 ASB is a leading provider for Kiwis' futures through its role as a KiwiSaver
scheme provider
 Virtually 100% of ASB lending activity remains within New Zealand”.

The Complaints Board considered that there were a range of factors that could
contribute to how a company may describe itself – including ownership.

The Complaints Board acknowledged that ownership of a bank was an important

issue to consumers. The Complaints Board noted that it had received a number of
complaints about the advertisement which indicated that there was a level of
concern about the claim “kiwi bank”.

The majority of the Complaints Board was of the view that the advertisement did not
imply New Zealand ownership and did not meet the threshold to mislead or deceive
the consumer with regard to this issue. The majority of the Complaints Board noted
that ASB Bank was owned by “the Commonwealth Bank of Australia and its
shareholders”. However, the majority also took into account the full wording of the
advertisement, “We’ve been a Kiwi bank since 1847” providing context to the “kiwi
bank” reference, that the ASB Bank brand only operated in New Zealand and had a
long established history of involvement in this country. Accordingly it ruled that the
advertisement was not in breach of Basic Principle 3 with regard to this issue.

A minority disagreed. In the minority view there was a clear implication of New
Zealand ownership in the reference to “kiwi bank” and that it was likely that
consumers would interpret the advertisement in this way. In the minority view the
advertisement was misleading and in breach of Basic Principle 3.

The Complaints Board then addressed the next issue raised in complaint, that the
use of the words 'Kiwi bank' could create confusion with Kiwibank Limited.

The Complaints Board took into consideration that the advertisements represented
ASB through the use of a unique colour range, font style, and logo. For these
reasons the majority said the ASB brand was clearly recognisable. It also noted that
the words 'Kiwi bank' were two words forming part of a sentence which provided
context, as distinguishable from the brand name “Kiwibank” which stood for Kiwibank
Limited.
 10 09/708

The majority was of the view that the advertisements were not misleading or
deceptive with regard to this issue and thereby were not in breach of Basic Principle
3.

However, a minority disagreed, saying the wording, which was identical in words to
the name and brand of a bank that is New Zealand owned, may create confusion and
could thereby mislead or deceive consumers. In the minority view, the advertisement
was in breach of Basic Principle 3 of the Code for Financial Advertising.

However, in accordance with the majority view, the Complaints Board ruled to not
uphold the complaint.

Decision: Complaint Not Upheld