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An Australian credit union has acquired a bank with a $570 million loan portfolio as part of its long-term growth strategy.
People's Choice Credit Union acquired TIO Bank following a competitive tender process conducted by the Northern Territory government.
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The acquisition includes TIO Bank's loan portfolio, worth approximately $570 million, and deposits of $124 million.
The acquisition will take People's Choice Credit Union's total assets under management and advice to more than $8.5 billion.
People's Choice managing director Peter Evers said the transaction demonstrated the potential for growth for the mutual sector.
"The major banks have enjoyed a significant boost to their competitive position since the global financial crisis, thanks to government-supported legislation and regulatory bias," Mr Evers said.
"As a leader in the mutual sector, we believe we have a responsibility to look for opportunities to redress that imbalance, both for the benefit of our members and for consumers in general, to ensure we continue to offer a genuine alternative to the big four banks," he said.
"This acquisition of TIO Bank proves there are opportunities for the mutual sector to grow due to our strong value proposition. The expansion reflects People's Choice's commitment to the growth of our business and the future prosperity of the NT."
The acquisition will see about 8,000 TIO Bank customers transfer to People's Choice, which has four branches in the Northern Territory.
Mr Evers said the TIO Bank transaction represented another important step in the organisation's long-term growth strategy.
"We have always been a growth-orientated business and we see no reason to change," concluded Mr Evers.
The transaction will be completed on January 2.
[Related: Why brokers should use mutual banks]
