Customer-owned banks growing at double the rate of big four

Data confirms a significant shift away from traditional banking

Customer-owned banks growing at double the rate of big four


By Madison Utley

Recent data has revealed that in the last 12 months, the customer owned banking sector is growing at over double the rate of the big four institutions.   

Year on year data provided by APRA shows that customer owned banking institutions grew their total housing loan book by 8.1% compared to 4.5% for ADIs and 3.7% for the big four.

Customer Owned Banking Association CEO Michael Lawrence said, “This data shows that Australians want banking institutions that put them first and they’re willing to switch institutions to get it.

“After 12 months of scandalous hearings into banking misconduct and poor practices, it’s no surprise that our sector has seen growth rates like these.”

Lawrence believes that the figures indicate that Australians are actively taking charge of their banking, but urged the industry to do more to simplify the process of switching to a customer-owned alternative.  

He said, “By making switching banks easier the big four will be put on notice by their customers to either shape up or risk losing them to customer-owned banking institutions that put their interests first.

“These figures will be a wake-up call for the big four.”

Just weeks ago, Australia’s largest mutual bank, Heritage, announced a net loan growth of $164.85m, up 271.61% from the $44.36m posted for the comparable period in 2017, confirming that borrowers do indeed view customer-owned options as genuine alternatives.

The data from APRA also showed that deposits have grown by 6% for the customer owned sector compared to 3.2% for all ADIs and 2.1% for the big four.

The customer owned banking sector now contains over $100bn in deposits and is the fifth largest holder of household deposits outside of the big four.

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