Non-bank in acquisition proposal

by Rebecca Pike14 Sep 2018

A non-bank has put forward a proposal for the acquisition of a community-based credit union in regional Queensland.

Firstmac Holdings Limited has confirmed the plans, which would see them acquire Maleny Credit Union (MCU), based out in the Sunshine Coast’s hinterland.

The proposal needs the support of MCU members before it can proceed, with the agreement to be put to a vote of members later this year.

Firstmac Holdings will also require FSSA approval from the Federal Treasurer.

As part of the agreement being put forward, Firstmac would need to make a long-term commitment to the community of Maleny, making a ten year branch guarantee.

According to an announcement by MCU, other details include Firstmac paying $7million for the business.

Four million dollars of this would be paid back evenly to MCU members, of which there are around 3000.

Another $2 million would be paid to the MCU Charitable Trust, to continue funding and supporting local community groups. Further to this, at least $30,000 will be donated each year depending on the branch’s profitability.

The final $1m will be used to pay back capital to MCU member investment share owners.

In MCU’s announcement, it said the opportunity with Firstmac could “achieve what the board believes is an excellent outcome and a superior offer for Members and the community”.

A statement from Firstmac said, “Firstmac has a strong history of growing a competitive business in the finance space, and is excited to have this opportunity to become part of and provide a beneficial service to the entire Maleny community.

“Regular updates will be provided on the progress of the proposed agreement in coming months.”

Firstmac also assured that cheque, savings and loan accounts would continue. There are also plans for improved online services, new products, and an increase in lending caps together with more competitive pricing/lower fees.

Deposited funds will continue to be covered by the government’s Deposit Guarantee.

COMMENTS

  • by Coast broker 14/09/2018 9:42:19 AM

    First Canon from Firstmac rubbished the goldfields and Finsure merger as not being in the best interest of the bank now here he is having a tilt at the Malany credit union himself...double standards I think

  • by Larz 14/09/2018 10:32:38 AM

    I would have thought there was a big difference between a funder buying an ADI than a broker group. A funder with a long track record of taking on the banks against a broker who who has been funded by them. I have no issue with either of them doing what they are doing but as a shareholder looking for value I would think the funder can deliver greater value. Time will tell.

  • by Brokers should protect borrowers 14/09/2018 11:49:35 AM

    Time will tell. Finsure and Goldfields can’t blame anybody but themselves going forward about making no profits. I personally think it’s great that APRA now have some regulation oversite over Finsure. Probably why CBA is separating Aussie out following their thrashing during the Royal Commission!