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Two mutual banks will proceed with their merger after receiving approval from their members.
Bank Australia and Qudos Bank will proceed with their merger after members this week voted in favour of the scheme.
Qudos Bank saw 78.43 per cent of members vote in favour of the merger on Monday (14 April) and 91 per cent of Bank Australia members voted in favour of the scheme on Wednesday (16 April).
As such, both banks exceeded the required 75 per cent ‘yes’ vote.
The banks will now seek final regulatory approval from APRA (having already had preliminary approval) as the banks prepare to bring the two organisations together as a merged entity on 1 July 2025
Once merged, the merged bank will have a combined total of over $17.5 billion in assets, serve 300,000 customers across Australia, and have 900 employees (all Australia based). It will operate an expanded 15 branch network across New South Wales, Victoria, Queensland and the Australian Capital Territory.
Speaking following the outcome of the vote, Bank Australia’s managing director, Damien Walsh said: “Throughout the merger process we’ve been committed to ensuring customers understand the benefits of the merged bank, so we are incredibly pleased to have had such a strong member vote in favour of the merger.
“We are thrilled about the value the merger will create for customers as we embark on a new phase of growth, ensuring our people and purpose are at the heart of everything we do.
“With the successful member vote we can continue to move ahead with seeking final regulatory approval and planning for day 1 of the merged bank. The focus of the merger is to provide customers with more benefits through a better, stronger and more resilient customer-owned bank and we’d like to thank everyone for taking the time to vote.’’
Brendan Wright to depart
Walsh, the current CEO and managing director of Bank Australia, will lead the new organisation and head office operations will be split across current locations in Sydney and Melbourne.
Qudos Bank CEO Brendan Wright will leave the merged bank on 30 June 2025.
Both banks thanked Wright for his “outstanding leadership and values-led approach in driving the merger strategy”.
Speaking of the merger outcome, Wright stated: “As a customer-owned bank listening to our members is core to what we do. During the merger process we held many member information sessions and answered lots of questions about what a merger would mean. We are delighted that Qudos Bank members so strongly support the merger, and we thank them for their time to engage and have their say by voting.
“The merger with Bank Australia is a significant milestone in Qudos Bank’s history and one we are excited about. We look forward to delivering greater value to members via lower fees and charges on a range of products, an expanded branch network and access to new products. Member benefits that would not have been possible without the merger.”
Jennifer Dalitz, the current chair at Qudos Bank, would become the new chair of the merged bank with Steve Ferguson (from Bank Australia) becoming inaugural deputy chair.
The merged board will include equal representation from both banks.
Mutual merger mania
The Bank Australia-Qudos Bank merger is one of a number of mutual bank mergers in the past year, with two having completed in the past year and another three in progress.
These include:
- G&C Mutual Bank and Unity Bank
- Teachers Mutual Bank Limited and Australian Mutual Bank Limited
- Summerland Bank and regional NSW lender Regional Australia Bank
It comes following warnings from APRA that mergers could be a possible solution to access advanced technologies and specialised expertise that would “otherwise be prohibitively expensive or too complex to develop internally”.
The prudential regulator has also recently said that some mutuals lack the skills to navigate a modern banking environment and need to continue to reduce strategic risks amid rising competition, the cost of new tech, changing customer behaviours, and the “war for talent”.
Speaking earlier this week, APRA’s executive board member for banking, Therese McCarthy Hockey, said that APRA had observed that the boards of some mutuals “lack the necessary skills to guide their banks in a modern banking environment, in particular, technology skills”.
To combat this, the banking specialist said mutuals needed to focus on upskilling directors and bringing in “fresh talent”, potentially looking “beyond [the] bank’s traditional geographic or industry-based pool”.
Hockey also said that mutual banks may also lose out due to the lengthy tenure of board members.
“Long tenure begins to raise questions about the ongoing ability of directors to exercise impartial judgement, challenge management effectively and be open to new ideas,” she said.
More to come.
[Related: Qudos Bank CEO hails ‘best of both’ approach as Bank Australia merger nears]
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