HomeMedia & ResourcesMedia ReleasesAustralia’s banking sector on its way to becoming more competitive

Australia’s banking sector on its way to becoming more competitive

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Australians will soon enjoy a more competitive banking sector after Parliament passed an important Bill during the busy budget week sitting period.

The Customer Owned Banking Association has welcomed the passage of the Treasury Laws Amendment (Mutual Reforms) Bill 2019 after being introduced into the Upper House in February this year.

The Bill includes both tranches of the reforms to address recommendations made in the Hammond Review to improve the ability of credit unions, building societies and mutual banks to take on the ‘Big Four’ banks.

The Bill amends the Corporations Act to implement the following key reforms:

  • defining a mutual entity.
  • reforming the demutualisation rules to only be triggered in an intended demutualisation, and
  • creating a mutual-specific Mutual Capital Instrument (MCI)

These reforms will improve the capacity of Australia’s customer owned banking sector to more easily raise capital and increase its ability to compete with the nation’s major banks.

Customer Owned Banking Association Chief Executive Michael Lawrence said that the bipartisan support for this Bill has helped create a more competitive banking sector.

“From its inception right through to its passage, this Bill has had resounding support from all sides of politics.

“There is a clear understanding amongst Members of Parliament that this Bill will help customer owned banking institutions become more competitive and take on the ‘Big Four’.

“Passing this Bill during the busy Budget sitting week and with a full parliamentary schedule is testament to just how important these reforms are for competition in the banking sector.

“Our sector is grateful for the support and advocacy from both sides of politics and the Parliamentary Friends of Mutuals and Co-operatives for their unwavering commitment to passing this Bill.

“Being able to raise capital will allow customer owned banking institutions to allocate more funding to projects that will deliver greater choice and competition for consumers.

“With greater competition, comes greater consumer outcomes. This is a milestone for competition in the banking sector and one that will only help improve customers’ outcomes.”

A PDF version of the media release can be read pdfhere

For more information please contact:

Mick Gibb
Corporate Affairs Manager
0423 149 494
This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Customer Owned Banking Association is the industry body for mutual banks, credit unions and building societies. Visit customerownedbanking.asn.au

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Media Contacts

Mick Gibb
Corporate Affairs Manager
P: +61 2 8035 8444
M: +61 423 149 494
Email Mickcontact-arrow

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