The mutuals have performed strongly in 2016, according to KPMG Australia’s Mutual Industry Review
Mutuals’ performance looks bright
Australia’s credit unions, building societies and mutual banks (‘the mutuals’) have had a good year in 2016, performing strongly in an environment of low economic growth, interest rates and inflation, KPMG Australia’s Mutual Industry Review reveals.
The figures show the mutuals’ balance sheets were strengthened with asset growth of 7.8%, compared with 5% for the overall banking industry.
KPMG Australia national head of mutuals Peter Russell said, “Mutuals’ performance this year has improved on previous years. What’s particularly interesting this year is that we’ve seen some breakout strategies. Some of the smaller mutuals have grown in the region of 20-30 percent, and some of the larger mutuals have also grown strongly.
“Mutuals are recognising that they can utilise their capital more efficiently, and have a very compelling value proposition in the current environment. We are seeing the return of mutuals as a more competitive force.”
KPMG is optimistic about the future for mutuals, with Russell saying, “Technology change is reducing the need for costly back office support, origination and servicing processes. This change dynamic means smaller, nimble organisations can implement new technology solutions without the need to replace legacy business practices."
“We have seen technology and the ‘platformification’ of business support growth in the UK banking sector, with UK challenger banks’ lending assets growing by 31.5 percent in 2016. Australian mutuals can draw from these profiles to expand growth, improve competitiveness and increase market share.”
Australia’s credit unions, building societies and mutual banks (‘the mutuals’) have had a good year in 2016, performing strongly in an environment of low economic growth, interest rates and inflation, KPMG Australia’s Mutual Industry Review reveals.
The figures show the mutuals’ balance sheets were strengthened with asset growth of 7.8%, compared with 5% for the overall banking industry.
KPMG Australia national head of mutuals Peter Russell said, “Mutuals’ performance this year has improved on previous years. What’s particularly interesting this year is that we’ve seen some breakout strategies. Some of the smaller mutuals have grown in the region of 20-30 percent, and some of the larger mutuals have also grown strongly.
“Mutuals are recognising that they can utilise their capital more efficiently, and have a very compelling value proposition in the current environment. We are seeing the return of mutuals as a more competitive force.”
KPMG is optimistic about the future for mutuals, with Russell saying, “Technology change is reducing the need for costly back office support, origination and servicing processes. This change dynamic means smaller, nimble organisations can implement new technology solutions without the need to replace legacy business practices."
“We have seen technology and the ‘platformification’ of business support growth in the UK banking sector, with UK challenger banks’ lending assets growing by 31.5 percent in 2016. Australian mutuals can draw from these profiles to expand growth, improve competitiveness and increase market share.”
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