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Despite ongoing talks about the benefits of a fifth pillar, it seems increasingly unlikely that the Australian lending market will ever see this come to fruition.
Speaking to The Adviser, Newcastle Permanent’s chief executive officer Terry Millett said it wasn’t sensible to believe that all of Australia’s credit unions and mutuals would join together to form a fifth pillar.
“The relationship between any of the customer-owned lenders is exactly the same as the relationship we have with the majors,” he said.
“We are all direct competitors. They are all completely independent organisations pursuing their own strategy. In many ways, we see our key competitors as being the four major banks, because they are the ones with the greatest market share. Most of the other customer-owned lending institutions have very low market share.
“When you stand back and have a think about the industry and what it is, it isn’t sensible to aggregate 10 or 20 organisations and say they somehow could become a mass company that can compete with the big banks. Unless they were run by one company and one board, that is just not sensible.”
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