Members Equity Gets Banking Licence
Members Equity, a joint venture between AXA and Industry Fund Services, as trustee for a over 100 superannuation funds, has secured a licence from the Australian Prudential Regulation Authority to operate as a bank.
Members Equity already offers housing and business loans a base from which the new bank can establish a presence based on core guiding principles of close relationships & low cost banking services. “We will focus on basic products that meet the everyday needs of Australian families” said Mr Anthony Wamsteker Chief Executive of Members Equity.
The new bank represents the biggest impact on the domestic banking scene since deregulation over 20 years ago. It will begin operations courtesy of the successful Super Member Home Loans business that has originated over $5 billion in residential mortgages since 1995. In generating volumes over $2 billion in annual mortgages the new player will find itself in the notable company of regional players such as Adelaide Bank, Bank of Queensland and Bendigo Bank.
Members are to benefit first from the initial rollout of basic banking products. Credit cards will be offered via Mastercard in November with all products available to the public from early next year.
In moving to become a bank Members Equity is now treading the same strategic path as the majors in order to counter their emerging allfinanze strategies such as the successful buyout of Colonial State Bank by Commonwealth Bank.
However Mr Wamsteker sees a distinct competitive advantage for Members Equity. Its large affiliated customer base can be accessed at a fraction of the cost of traditional distribution strategies using technology and alliances therefore eliminating the need for an expensive network of branches.
Alliances with Australia post and Cashcard will allow ME account holders to deposit and withdraw funds through the national ATM network thereby avoiding many of the fees charged by banks.
With attention and resources aimed at warding off non-bank lenders over recent years, time will tell just how the majors and indeed regional banks will react to this latest competitor. Unlike the foreign banks it has the potential to have a profound impact on Australian Consumers