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‘Well-run’ customer-owned (or mutual) financial institutions have a bright future, claims Newcastle Permanent CEO, Terry Millett, because the major banks fail to provide the same value to one third of Australians living in regional communities.
Millett’s comments follow the lender’s annual general meeting in Newcastle last week.
“After 110 years, we are still proof that the customer-owned banking model can deliver better value to members, meaningful support for regional communities, strong financial performance and can outperform the major banks in a competitive market,” says Millett.
“We’re in the process of expanding our branch network into the Central West of NSW and, again, we have identified an apparent attitude of arrogant indifference by the major banks towards regional communities.”
He claims the big four are happy to make a ‘significant portion’ of their multi-billion dollar profits ‘off the back’ of regional Australians but fail to give much back to the communities.
In the 2012/13 financial year, Millett says the Newcastle Permanent group of companies provided more than $3m in financial support to local communities.
“In contrast, a major bank making an annual profit of $6 billion would have to contribute almost $500 million to local communities to provide an equivalent level of support – which clearly does not occur.”
