The RACQ is aiming to challenge the big four banks through its proposed merger with QT Mutual Bank, formerly known as the Queensland Teachers Credit Union, with the insurance and motoring body aiming for a footing in the domestic loans market.
RACQ Group CEO Ian Gillespie said that the banking expertise and products of QT Mutual Bank would allow the group to diversify and enter the lending sector.
"We want to be a trusted alternative to the shareholder-owned, profit-driven banks," Mr Gillespie said. "We hope to attract other large mutuals to come together with us to produce something which ultimately can challenge the big four banks in a substantial way.”
The possibility that the RACQ might challenge the big four banks will no doubt prick the ears of Australia’s mortgage brokerage industry. Jeremy Fisher, broker at Sydney’s 1st Street Home Loans, greeted the news with cautious optimism.
“It is good to see new players enter the mortgage market,” Fisher told Australian Broker, “and a positive move in my opinion as it is coupled with further investment and awareness for the broker channel. Time will tell whether the synergy is a successful one as RACQ will not be the first to partner up with a lender for distribution.”
Gillespie believes the RACQ’s position is strengthened by its large membership that numbers 1.6 million, along with the 8 million who are members of automobile clubs in Australia, which he describes as “a substantial member base into which we can sell".
The proposal will be put to QT Mutual Bank members by the middle of the year, with QT CEO Steve Targett hoping that the merger proposal will be met with support. Targett said, “By becoming RACQ's banking arm we retain our people, expand our personal banking services significantly and improve our online and digital banking capabilities."
