FIT Sponsorship
MEDIA, JOBS & RESOURCES FOR THE COMMON GOOD
NEWS  |  Good Business

Mutuals Outperform Traditional Banks


Wednesday, 30th November 2016 at 9:17 am
Ellie Cooper, Journalist
The customer-owned banking model is continuing to outperform traditional banks, “revealing the strength” of the co-operative and mutual sector despite regulatory constraints.


Wednesday, 30th November 2016
at 9:17 am
Ellie Cooper, Journalist


0 Comments


FREE SOCIAL
SECTOR NEWS

 Print
Mutuals Outperform Traditional Banks
Wednesday, 30th November 2016 at 9:17 am

The customer-owned banking model is continuing to outperform traditional banks, “revealing the strength” of the co-operative and mutual sector despite regulatory constraints.

According to KPMG’s annual Mutual Industry Review, the asset growth of mutual banks was 7.8 per cent, compared to 5 per cent for the overall banking sector.

KPMG  put the results down to effective business strategies and risk-management practices, and leveraging digital technology.

The peak body for co-operatives and mutuals also said the performance of customer-owned banks was due to the “strong value proposition”.

Business Council of Co-operatives and Mutuals CEO Melina Morrison told Pro Bono Australia News mutual banks put their customers first.

“The customer is the major beneficiary of the business and the whole focus of the business. It’s why the bank is in business in the first place, is to serve its members and its members are its customers,” Morrison said.

“It is a sign that people are going towards banking and they’re attracted to banking with ethical and customer-focused institutions, so I would say that one of the reasons why they’re growing and they’re strong is because of high customer satisfaction.”

She said the results were “remarkable” given mutuals and co-operatives are operating on an “unlevel playing field”.  

“It is a sign of the resilience of the business model in very challenging times, and what is extra remarkable about this is that they’re doing it with one hand tied behind their back,” she said.

“Not only are they showing very strong performance, but they are showing that they can do that in a regulatory and legislative environment that puts them at a disadvantage.”

The council has repeatedly called for reforms to ensure co-ops and mutuals are able to compete with traditional businesses.

In March a report from a bipartisan Senate inquiry recommended the sector receive more support and recognition from the federal government.

It advised that the Corporations Act be amended to explicitly define customer-owned enterprises and said barriers to innovation, growth and free competition should be addressed.

Earlier this month Labor created a new portfolio to oversee the sector, to be taken on by Shadow Assistant Treasurer Andrew Leigh.

Morrison also called on the public to show support for co-operatives and mutuals by voting with their wallets.

The council launched a #switchnotbitch campaign to educate and encourage consumers to shop around for alternative, trustworthy banking choices.

“Consumers [need] to make a deliberate choice – sure it can be a hassle to change an account over, or switch to another provider – but once you do it, you are actually strengthening competition as well as making a deliberate choice based on your values and ethics,” Morrison said.

“There’s more than 80 credit unions, mutual banks and building societies to start with, not to mention, mutual health insurers, member owner superfunds and customer owned retailers.”


Ellie Cooper  |  Journalist |  @ProBonoNews

Ellie Cooper is a journalist covering the social sector.

FEATURED SUPPLIERS


Brennan IT helps not-for-profit (NFP) organisations drive gr...

Brennan IT

Fantastic digital management app for organisations deliverin...

Ateesa

NGO Recruitment is Australia’s not-for-profit sector recru...

NGO Recruitment

HLB Mann Judd is a specialist Accounting and Advisory firm t...

HLB Mann Judd

More Suppliers

Get more stories like this

FREE SOCIAL
SECTOR NEWS

YOU MAY ALSO LIKE

Predictions for 2018: Co-operatives

Melina Morrison

Thursday, 11th January 2018 at 7:50 am

Australian Co-operatives Named Among World’s Best

Luke Michael

Tuesday, 5th December 2017 at 4:36 pm

Mutual Economy Contributing More to Australia’s GDP

Lina Caneva

Tuesday, 5th December 2017 at 4:01 pm

Leading A Purpose Driven Economy

Rachel McFadden

Friday, 23rd June 2017 at 2:18 pm

POPULAR

$110M Package Tackles Anxiety and Depression Among Young Australians

Wendy Williams

Tuesday, 9th January 2018 at 8:46 am

Social Enterprise Announces $500,000 Funding for Social and Affordable Housing

Luke Michael

Monday, 15th January 2018 at 11:26 am

Privatisation Poses New Challenges for NFPs Managing Their Workforce

Luke Michael

Tuesday, 9th January 2018 at 4:36 pm

White Ribbon Australia CEO Announces Retirement

Wendy Williams

Wednesday, 10th January 2018 at 5:15 pm

Write a Reply or Comment

Your email address will not be published. Required fields are marked *


FIT Sponsorship
pba inverse logo
Subscribe Twitter Facebook

Get the social sector's most essential news coverage. Delivered free to your inbox every Tuesday and Thursday morning.

You have Successfully Subscribed!