Westpac’s card arm suffers from Ansett collapse
Westpac is still feeling the impact of Ansett's collapse on its credit card division, as it was the only major bank to have its card bsuiness aligned solely to Ansett's Global Rewards program. According to the bank's head of business and consumer banking, David Clarke, about 40 per cent of Westpac's total credit card base was originated through the Ansett-owned loyalty program. It has seen a massive drop in card-spending activity since last September, when the airline first collapsed. Mr Clarke says that the bank's share of credit card outstandings in Australia fell from more than 21 per cent to about 20 per cent at the end of 2001.
As unsecured creditors, Global Rewards cardholders are unlikely to get more than 2 cents in every dollar on the 67 billion loyalty points that have been frozen since last September.
Westpac is about to launch a major marketing campaign for its new Westpac-owned loyalty scheme, Altitude, to try and win back customers who deserted the bank for other card providers.