Bank Australia and Qudos Bank have announced their intention to explore merging, aiming to combine two of Australia’s leading customer-owned banks focused on purpose-driven banking.
The decision to consider this merger stems from the Boards of both banks recognizing strong cultural alignment, shared values, and a commitment to customer ownership that prioritizes the best interests of customers.
This potential merger presents an opportunity to enhance outcomes for customers by bringing together two similarly aligned purpose-driven banks in the customer-owned banking sector. The resulting entity would become one of Australia’s largest customer-owned banks, providing a robust platform to accelerate the organic growth achieved by both banks in recent years. Customers would benefit from increased scale and improved capabilities to invest in advanced products, services, and digital banking technology.
Combining Bank Australia and Qudos Bank would result in a bank supporting 300,000 customers, with total assets surpassing $17 billion and nearly 900 employees. Bank Australia’s strong presence in Victoria combined with Qudos Bank’s significant footprint in New South Wales opens up new growth avenues, extending the advantages of customer-owned banking to a broader Australian audience.
With shared commitments to achieving net-zero carbon emissions and making positive impacts for customers and communities, a successful merger would enable the banks to further drive positive outcomes for people and the environment.
Jennifer Dalitz, Chair of Qudos Bank, expressed excitement about the merger, highlighting the shared values and customer-centric approach of both banks. She emphasized the potential to create Australia’s leading purpose-driven bank, enhancing experiences for customers and expanding the reach of purpose-driven banking.
Steve Ferguson, Chair of Bank Australia, echoed this sentiment, underscoring the cooperative principles and longstanding history of creating real benefits for customers. He emphasized the opportunity to build on commitments to people and the planet, including the ambitious net-zero target for 2035. A merger, he added, would strengthen both banks, ensuring ongoing support for customers and communities into the future.
Key aspects of the proposed merger agreement include:
- The proposed Board structure for the merged entity includes Jennifer Dalitz (Qudos Bank) as the inaugural Chair and Steve Ferguson (Bank Australia) as the inaugural Deputy Chair. The merged Board will feature equal representation from both banks, ensuring the retention of necessary skills and experience.
- Damien Walsh (Bank Australia) is set to assume the role of Chief Executive Officer and Managing Director, while Brendan Wright (Qudos Bank) will have the opportunity to continue in an executive capacity within the merged entity.
- All non-executive employees will be offered the opportunity to apply for roles within the merged entity, including redeployment opportunities where suitable. Head office operations will be divided between Collingwood (VIC) and Mascot (NSW), and the merged entity plans to retain and review all current branches to meet customer service needs.
- Both brands will be retained initially following the merger, with plans for a future review in due course.
Now that the Memorandum of Understanding has been signed, Bank Australia and Qudos Bank will embark on a comprehensive due diligence process to thoroughly evaluate the advantages of the potential merger for customers.
Should both Boards decide to move forward after the due diligence phase, members will be invited to vote on the proposed merger either in late 2024 or early 2025, following the completion of all necessary regulatory reviews and approvals.
Members of both banks will receive regular updates on the progress of the merger and will be furnished with additional information to assist them in making an informed decision if the merger proceeds to a vote.
Frequently asked questions
Will the merger affect the customer ownership structure?
No, the merged entity will continue to be 100% customer owned.
How will the merger affect employees?
The proposed merger is about building a bigger, stronger purpose driven bank. The aim is to create opportunities to improve customer experience and increase our impact, not about cost cutting.
All non-executive employees will be offered or have the opportunity to apply for roles within the merged entity including redeployment opportunities where appropriate.
What will happen with branches and offices?
Head office operations will be split between Collingwood (VIC) and Mascot (NSW), while all current branches will be retained and reviewed by the merged entity to support customer service requirements.
How will products and services be affected?
Products held by customers of each bank will continue on existing terms and conditions following the merger.
Should the proposed merger be approved – variable rate products will be harmonised in due course and fixed rate products will be harmonised post maturity.
What will the name of the merged entity be?
The merged entity will be Bank Australia Ltd.
What brand will the merged entity operate under?
Both the Bank Australia and Qudos Bank brands will be retained in the period following the merger, with an intention for future review in due course.
When will members be asked to vote?
If both Boards decide to recommend a merger following the due diligence process, members of both banks will be asked to vote on the merger proposal.
While it is too early to identify a date when members may be asked to vote, if the merger does proceed a vote will be held in late 2024 or early 2025. We will keep employees and customers informed of progress.
Members will be provided with a detailed information pack ahead of being asked to vote.
Will this affect Bank Australia’s public commitments like its 2035 net zero target?
The merged entity will maintain the public commitments of Bank Australia.
How will the Board be composed?
The proposed Board composition with Jennifer Dalitz (Qudos Bank) as inaugural Chair and Steve Ferguson (Bank Australia) as inaugural Deputy Chair.
The merged Board will include equal representation from both banks and will ensure retention of the required skills and experience.
Who will be the CEO?
Damien Walsh (Bank Australia) to become Chief Executive Officer and Managing Director, while Brendan Wright (Qudos Bank) will have the opportunity to continue with the merged entity in an executive capacity.
Does the proposed merger need regulatory approval?
The proposed merger will be assessed by the Australian Prudential Regulation Authority (APRA) and its approval needed for the merger to proceed. APRA will undertake appropriate consultations with ASIC, ATO and Treasury.
About Bank Australia
Bank Australia exists to inspire and empower customers to use their money to create a world where people and the planet thrive. We are 100% customer owned, a certified B Corp and we aim to be Australia’s most trusted bank. Our commitment to clean money means we focus our lending and investments in areas that do good, not harm, for people and the planet. We support over 190,000 customers and we’re the custodians of more than $11 billion in assets.
About Qudos Bank
Qudos Bank is one of Australia’s largest customer owned banks with over $5b in assets. Being 100% customer owned means our customers and owners are one in the same. Everything we do, the decisions we make, and the way we operate is designed with the customer at the heart of it all. We exist for the benefit of our customers and the community, not for making profit for the benefit of shareholders. We are a proud member of the Customer Owned Banking Association and have made a commitment to follow the Customer Owned Banking Code of Practice. We believe in doing the right thing for customers and our community, helping them realise their potential, and in the power of people coming together to pursue their financial freedom. Our goal is to be the bank our customers value most.
