Bendigo, credit unions in banking tie-up

BENDIGO and Adelaide Bank has secured an agreement with four credit unions that will see it establish a new banking model.

BENDIGO and Adelaide Bank has secured an agreement with four credit unions that will see it establish a new banking model as it continues to take the fight to the nation’s big four banks.

Under the agreement, the loans and deposits of the four credit unions — AWA Credit Union, Berrima District, Circle Credit Co-operative and Service One — will be transferred to Bendigo Bank, but reserves will remain 100 per cent member-owned.

Bendigo Bank will become the approved deposit-taking institution and will assume responsibility for compliance, systems and balance sheet management.

The agreement is subject to final approval from the Australian Prudential Regulation Authority and Joe Hockey, as well as 75 per cent of voting members at the respective credit unions’ annual general meetings.

The four credit unions collectively have 39,000 members, $640 million in assets and $550m in deposits.

Service One chief executive and spokesman for the alliance of credit unions, Peter Carlin, said the groups have achieved the best of both worlds for members by working with Bendigo Bank to develop the model.

“We keep our independence, remain 100 per cent member-owned and continue to provide a very caring, personal service,” Mr Carlin said. “At the same time the agreement with Bendigo opens up greater capacity to meet our members’ needs, offer greater competitive choice and provide access to a wider range of services and modern service technologies.”

Bendigo Bank managing director Mike Hirst said the lender would continue to play an active role in the changing financial landscape.

“We have a proven track record of working with organisations and communities on solutions to challenges they face,” Mr Hirst said.