Motoring association and mutual organisation Royal Automobile Club of Queensland (RACQ) has launched the RACQ Bank brand, opening 13 branches across the state.
Unveiled yesterday (25 September), the bank will provide personal banking products including mortgages to RACQ’s 1.6 million members.
“We’re committed to giving members honest, easy and great value banking products and services, without any hidden fees or excessive charges,” said RACQ group CEO Ian Gillespie.
“We’re also one of Queensland’s last remaining mutual banks, and we are working for our members not for shareholders. Any profits the bank makes will be reinvested back into the RACQ ecosystem for the benefit of our members here in Queensland.”
In the first step of the bank’s expansion strategy, home loans will be offered through direct channels, RACQ Bank CEO Steve Targett told
Australian Broker.
Targett was the former CEO of QT Mutual Bank, eventually becoming CEO of RACQ Bank after it acquired QT Mutual in November 2016.
“QT Mutual was a lot smaller. We had about 67,000 members. RACQ has got 1.6 million so the first step of our strategy is to penetrate that member base with personal banking products – the main one of which is mortgages,” he said. “Then we’ll look at the next step of our strategy in terms of penetrating our member base and cross-selling products.”
The bank will consider working with brokers at a later stage once these initial phases are completed, he added.
“It’s on our critical path of things to look at but not in the next six months. At some stage, it’s something that we’ve got to look at and will probably be one of the next things once we feel we’ve got our basic capabilities right.”
The bank’s main products – residential mortgages, car loans and personal loans – will be distributed across Queensland through RACQ Bank’s 13 branches and RACQ’s 34 stores.
“We need to look at providing some sort of banking capability out of some of RACQ’s stores particularly in areas where we don’t have branches. There are quite a few RACQ members up the seaboard between the Sunshine Coast and Townsville. We’ve got some stores there but we don’t have any bank branches. These are things that we need to look at.”
Building a team of mobile lenders was also on the agenda so that banking products could be offered to customers in remote locations, Targett said.
RACQ Bank’s loans will be funded directly through its equity such as transaction accounts and term deposits. The bank can also access wholesale funds through negotiable certificates of deposit or medium-term notes and can draw additional capital through RACQ itself.
Related stories:
Ex-Pepper CEO acquires SME lender
Broking franchise names new GM
Brokerage forms insurance partnership
