Judo Bank gets a hold in the banking market

Judo co-founder Joseph Healy. Picture: Britta Campion

As the Westpac board prepares to decide on its next chair, upstart bank Judo has hit the ground running with $1 billion in deposits after just nine months of operation.

Judo Bank co-chief Joseph Healy is confident of raking in at least $3 billion by this time next year, which would be a good base to grow the business.

The bank, which is devoted to small business loans, already has over $1 billion in loans outstanding.

Judo’s deposit take is tiny compared to the majors, with National Australia Bank, for example, having $424 billion in customer deposits.

Judo has raised the money by paying above market with its six-month deposit rate at 1.95 per cent, compared with the big banks at 1.25 per cent.

Healy said the big banks have had 150 years to build their base and Judo just nine months so its rate of growth, which is important, and today’s figures, show it is getting traction.

Around 40 per cent of the deposit base is retail.

Importantly the milestones show the bank has gained some market credibility at a time when the big banks are suffering.

The Melbourne-based Judo has around 165 staff with offices in Sydney and Brisbane and it plans to open in Perth in a couple of months.

Meanwhile Westpac’s board is still in its early days in its hunt for a new chair to replace Lindsay Maxsted, with his former KPMG colleague Peter Nash the obvious internal candidate given his background covering the industry.

The board will also look for potential external candidates.

The chair will be settled before a new chief executive is selected to replace Brian Hartzer.

Former CFO Peter King has agreed to stay until a successor is found and is also the key internal candidate for the job.