The Evolution of Community Banks in Regional Australia

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The Evolution of Community Banks in Regional Australia

In Mannum, South Australia, the departure of the only bank branch following a flood left residents like Cathy Clemow exploring the possibility of establishing a community bank. Clemow engaged with the local community to gauge interest and support for creating a new banking institution, especially after businesses mentioned cost increases due to added travel expenses.

While advocating for a community-driven approach to establish a bank, Clemow highlighted the need for individuals within the community who possess the expertise to run a financial institution successfully. The merging of People's Choice and Heritage Bank to form People First Bank illustrates a shift towards customer-owned banks, which operate without shareholders and dividends, as reiterated by the bank's CEO, Peter Lock. This model reflects a response to the evolving banking landscape, acknowledging the digital transformation and the changing needs of different client generations.

Stephanie Elliott, the Chief Operating Officer of the Customer Owned Banking Association, emphasized the importance of maintaining consumer-focused banking models, particularly in serving specific communities based on various factors like geography, profession, or culture. She also praised innovative solutions implemented by banks, such as partnerships with local councils to keep branches open in regions like central Queensland, demonstrating a commitment to fostering financial services within communities despite challenges faced by the banking sector.