ATB at a turning point ATB Financial Public Business Plan 2011-2015
Table of Contents Message from the President and CEO 2 A Unique Alberta Paradox 3 Dream 4 Goals 5 Strategy 7 Creating Value in our Lines of Business 8 Corporate Social Responsibility 14 Measuring How We Make a Difference 15
Message from the President & CEO This business plan for 2011 2015 will be an important turning point for ATB. With implementation of our new banking system in 2011, we ll be able to shift our focus to optimizing the new system and converting its potential into real, tangible results. Combining that with new approaches to leadership and innovation within each of the lines of business, we re on track to take ATB to the next level providing leading-edge services to our customers, expanding our connection to communities across the province, and making ATB a growing source of pride for Albertans. All of this points to an exciting new chapter for ATB one where the focus shifts to up-ing our game, while maintaining all the strengths that make us vintage Alberta for more than 670,000 customers. Dave Mowat President and CEO 2
A Unique Alberta Paradox ATB was established more than 70 years ago to serve Albertans and to be there when people need us. And that essential purpose has not changed even though Alberta today is a very different and constantly changing place. To fulfill our purpose of serving Albertans and meeting their financial needs, we will maintain our deep connection to the province and continue to be a uniquely Albertan financial institution. The result is a paradox that defines the uniqueness of ATB and what we aspire to be. On the one hand, we have a big bank s world-class expertise and capability. Our customers count on us to deliver outstanding products and services and the advice they need. We re constantly adapting listening to our customers, anticipating changes in the business world, and building brilliantly simple solutions. On the other hand, we keep that small bank feeling. Our deep connection to Alberta communities and customers is what distinguishes ATB, and we re proud of it. We pride ourselves on understanding Albertans and Alberta because this is the only place we do business. And we have a passion and a purpose to earn Alberta s pride. Whether they re customers or not, our goal is to make Albertans proud of ATB and the contribution we make to Alberta. Put those elements together and it means ATB will be as expert as any big bank, as caring as any small one, and here to do Albertans proud. ATB Financial 2011-2015 Public Business Plan 3
Dream ATB is focused on a dream. Changing our world speaks to the ability to be bold and to think big, to not be constrained by conventional wisdom, and to understand that ATB makes a difference to our customers and our province. Putting people first simply underlines how we do things at ATB. Harnessing the power of people whether it is with our associates or our customers is the root of ATB s success. And making dreams come true is our understanding that there is a lot more to banking than transactions. It is about getting results that create value for customers, associates, and Albertans. We re proud to be Albertans partner getting there together. We are changing our world by putting people first and making dreams come true. 4
Goals Pursuing that dream is not simply an exercise in words; we want to make the ATB dream concrete and alive for our customers, our associates, and Albertans. ATB s business plan is focused on achieving three important goals: To be number one in every market we choose. It s a bold goal. At ATB, we deliberately choose to operate in four lines of business: Retail Financial Services, Independent Business & Agriculture, Corporate Financial Services, and ATB Investor Services. We pride ourselves on understanding the Alberta marketplace and our customers. And we believe strongly that we can take that understanding, combine it with inspired leadership and great people, sophisticated tools and processes, add our deep connection to communities, and use that unique combination to be the leader in every market we choose. To be the place to work. Many companies say they are great places to work some even live up to the promise. At ATB, we want to take that one step further. For people who work in the financial services industry or in areas that support our success, we want to be known as the place to work at some point in their careers. To be loved and respected by Albertans. It might sound strange for a financial institution to talk about being loved. But there is no better word for it. If we achieve the paradox of having all the sophistication and expertise of a big bank combined with the passion and connection to customers and their communities, we believe that more and more Albertans will be proud of their ATB and want to do business with a financial institution that s uniquely Albertan. ATB Financial 2011-2015 Public Business Plan 5
Strategy ATB s strategy is grounded in the key pillars of leadership, innovation, process and understanding. The strategic themes for this business plan are built upon those foundational elements. Leadership. When Albertans think about financial services, they likely think it s all about money. But, in reality, it s all about people and relationships. Outstanding and inspiring leadership that builds strong relationships with our customers and our associates is critical to our success. The focus on infusing outstanding leadership skills what it takes to be a leader at ATB will span every level and area of the organization. Core banking system. Extracting the full value and achieving the full potential of ATB s new banking system will help us take our performance to the next level. That involves a commitment across the entire organization to leverage the capacity of the new system to improve services for our customers, improve productivity, drive innovative new business ideas, and grow our business. Raising the volume. ATB is a well-respected financial institution and we re well known for our deep connection and commitment to communities across the province. As part of this business plan, we will implement a deliberate strategy to raise the volume on ATB s brand and reputation with the ultimate goal of attracting more customers, increasing our market share, and having more and more Albertans feel proud that they own ATB. Innovation. Our focus on innovation will help us remain nimble as circumstances change over time. We will be better able to anticipate new opportunities to serve our customers and to adapt quickly to their changing needs and expectations. We re in a highly competitive marketplace and our strategy is to combine the creativity and bold ideas of a unique team of people with the practical expertise of our lines of business. Productivity and results. With the combination of new tools, broad reach, a strong reputation, and engaged people, we believe there is opportunity to achieve significantly better financial results. Our bold targets for financial results will be achieved through real gains in productivity, targeted increase in market share, and more focused controls on expense growth. Regulation and compliance. All financial institutions, including ATB, will face continuing pressure to meet high regulatory standards. We will continue to work closely with our regulator to ensure that ATB meets the same high standards as other Canadian financial institutions. 7
Creating Value in Our Lines of Business Across ATB, an invigorated focus on leadership combined with new faces in key positions means we re on a new track, with new ideas and approaches. New leadership in Retail Financial Services brings an opportunity to reinforce the critical role our branches and all our channels play as the foundation of our entire business. Independent Business & Agriculture is beginning to hit its stride and achieve its goal of providing the best independent business and agriculture offering in the business. Corporate Financial Services continues to make its mark as a player in the commercial banking scene. And after a couple of years bucking turmoil in the markets, ATB Investor Services has successfully maintained market share and has a bold strategy to accelerate its growth and profitability. All of this points to an exciting new chapter for ATB one where the focus shifts to leadership, to execution and results, and most of all, to serving the ever-changing needs of Albertans and our customers like we ve done for the past 70-plus years. 8
Retail Financial Services (RFS) is setting a new course for the next five years, one that harnesses the energy and enthusiasm of our associates and capitalizes on our strength as an Alberta-based and focused financial services provider. Our key strategies and initiatives are centred on: Leadership value proposition. By continuing to invest in a higher level of leadership, based on attributes that are unique to ATB, branch managers and all leaders will make more significant impacts in their communities and create a more rewarding work environment where associates will want to stay and grow. The role of branch manager will become not only a more pivotal role within Retail Financial Services but will also be a vital connection to all our lines of business and be the face of ATB in communities across the province. Associate value proposition. Our plan is to enrich the career experiences of our associates by better connecting roles and opportunities with the value we can bring to our customers. To achieve this, we will introduce new and innovative training, reward individual performance, and convert efficiencies of our new banking system into value for associates and better experiences for clients. Customer value proposition. We are committed to a high-touch, high-value proposition for our customers. We will create value by customizing solutions and giving our clients the information, options, and understanding they need to make the best choices possible at those critical life junctures when people need our help the most. We will elevate our brand in the minds of our clients to become one that connects with their values, exceeds their expectations, and fits their modern lives. Channels and delivery. The future of our retail banking offer will unleash new opportunities to create new service delivery channels and payment methods focused on clients needs letting clients choose and create a true my ATB experience. By driving more client value through various channels, we can provide advice and support in new and innovative ways that meet each client s unique needs. ATB Financial 2011-2015 Public Business Plan 9
Independent Business & Agriculture (IB&Ag) continues to be guided by our customer and associate value propositions the basis of our strategic direction as we strive to reach our goal of having the best independent business and agriculture offering in the world. We ve made significant progress in building the foundation of our strategy and will continue to build on this momentum in the years to come through the following strategic priorities and initiatives: Retain, attract, and inspire great associates. With a solid organizational structure in place, the focus shifts to designing roles that enable our associates to stay and prosper with their customers. By empowering our associates to make meaningful decisions, we will enable them to think and act like their entrepreneurial customers. Understand our customers and unleash their potential. This priority is really about understanding our customers and all Albertans. By identifying our target markets, we have narrowed our focus to areas we want to thoroughly understand in order to deepen our relationships and deliver the value and solutions those business owners need to be successful. Be prudent in running the business. We will maintain continuous focus on ways we can improve our processes and educate our associates around risk management. We have teams dedicated to improving both our processes and our understanding and focus on compliance. Provide a fair return. Now that our foundation is largely set, we are well positioned to begin achieving our targeted growth. 10
Corporate Financial Services (CFS) focuses on defining the standard for customer service in Alberta corporate banking; on applying the innovative capabilities of our knowledgeable associates to reflect needs in the market; and on fully leveraging technology to further develop products, processes, and services. Our business plan includes the following strategic priorities: Drive from relevance to significance. CFS has moved from a relatively small player in the corporate banking marketplace to a trusted and respected source of expertise. Building on the reputation we have built in the energy sector, our plan is to continuously expand product offerings, drive our capacity to lead syndications, and formalize our capability for secondary loan trading. Expand our presence. We will expand our analysis of Alberta-based corporations, focusing on those potential customers who meet our credit-quality standards and fit with our target markets. We will drive increased customer satisfaction through effective implementation of the capabilities of ATB s new banking system, including cash management. Develop our business. We will expand our product offerings of loans, cash management, derivative products, and currency trading. These initiatives will support our goal of being number one in our chosen markets and allow us to achieve our tactical growth targets. Leverage technology. ATB s new banking system will help enable better customer service, closer interactions with clients, better processes, greater efficiency and productivity, and improved engagement of our associates. ATB Financial 2011-2015 Public Business Plan 11
ATB Investor Services (ATBIS) is committed to understanding and helping people become better investors so they realize their dreams in spite of inevitable and unpredictable challenges. There are four cornerstones to the ATBIS business plan: being more relevant and touching the lives of more Albertans than we do today; moving forward with our investments in simplicity that allow us to spend more time helping people become better investors and less time filling out forms; emphasizing mastery as we groom our advisors; and generating sustainable profits and solid return on capital. The next level will focus on improving client service and achieving results in a more cost-effective way in all market conditions. Our strategy includes the following priorities: Become master advisors. We will identify, develop and support our advisors to rapidly become master advisors. Supported by team of specialists, our master advisors will help more Albertans, build stronger client relationships, and profitably grow our market share. Leverage technology to increase advisors capacity. ATB Connect will continue to reduce geographic barriers, connecting advisors and clients, no matter where they reside. The new Wealth Management Foundation technology will also help increase the productivity and capacity of our advisors. 12
ATB s Strategic Service Units work behind the scenes, partnering with and supporting the lines of business in delivering on ATB s promise to our customers, associates and Albertans by: Helping provide a consistent customer and associate experience Measuring and monitoring ATB s key success factors and ensuring the full benefits of the new banking system are achieved Providing specialized subject-matter expertise, information and advice Ensuring that ATB s growth comes with sound financial, business, risk management and governance practices Enhancing ATB s reputation as an outstanding Alberta company Reinforcing our commitment and connection to communities across the province ATB Financial 2011-2015 Public Business Plan 13
Corporate Social Responsibility ATB is a financial institution with an unparalleled connection to the communities in our province. Each year ATB contributes millions of dollars to a wide range of community causes and sponsors events that are part of the fabric of the province. So whether that s supporting children s hospitals, the arts, health and wellness through sports, or many other meaningful causes, Albertans can count on ATB to be involved. Our corporate social responsibility program is a broad approach that includes not only our contribution to charitable causes but also our governance practices, associate policies and practices, environmental policies, and the contributions we make as a company to Alberta society in general. As part of this business plan, we will expand our commitment to community causes and charities and follow through on an environmental strategy designed to achieve ATB s targets for reducing our carbon footprint. 14
Measuring How We Make a Difference ATB will measure our progress in achieving our goals using the following key metrics: Market share. We will tangibly increase market share, year in, year out. While our goal is to be number one in the markets we choose, we see this as a measure of relevance as more Albertans choose to become ATB customers it s not just about believing that bigger is better. Employee engagement. The best employees drive the best business and attract customers. We ve shown that ATB is one of the best places to work, not only in Alberta but in all of Canada, and we will continue to build on that foundation. Our goal is to more tangibly understand the link between engaged associates and increased market share to ensure we convert our engagement into results. Brand reputation. In an industry where the trust of our customers, our owner, and the market in general is essential to success, understanding and building our reputation is critical. As we approach our 75th anniversary, our goal is clear: to expand on our roots and build a broader and deeper reputation as a successful part of the unique and changing business landscape in the West, a financial institution that people want to be a part of, and one in which Albertans feel real pride. The common denominator will be a deeper understanding of the causal relationship of these factors to our financial results results that will be reflected in a risk-adjusted return on capital (RAROC) that compares favourably with other financial institutions across Canada. #1 in every market we choose The place to work Loved and respected by Albertans Results Market Share Employee Engagement Reputation Risk Adjusted Return on Capital ATB Financial 2011-2015 Public Business Plan 15
During the first year of our plan, we will refine the definitions and calculations for our new and evolving metrics, and will establish the associated 5-year targets. In the meantime, we will set our 2011-2012 accountabilities around the measures that we have relied upon to get us to this turning point. Performance Objective Measure 2011 Target Employee Engagement 79% Customer Satisfaction - TRiM 89% Return on Average Assets 0.80% As we begin this exciting new chapter in the story of ATB, we believe that by the time we celebrate our 75th birthday in 2013, ATB will be at the forefront of the banking industry in Canada and a continuing source of pride for Albertans. 16
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