Teachers Credit Union, one of Australia’s largest and most successful mutual banking groups, plans to rebrand as “Teachers Mutual Bank”, subject to member approval. The credit union will put its proposals to its members at its AGM on 26 November. APRA approval would also be required.

“If the member vote is successful, the key changes for us will be our name, and our opportunity to access more cost-effective funding,” said Steve James, CEO of Teachers Credit Union.

“However, the face of Australian banking will undergo a deeper transformation. Significant players in the mutual sector are taking the next step, and bringing their model of member owned banking to the forefront,” he said.

Mr James said this move has been inspired by the government’s banking reform package, a significant part of which includes building a new fifth pillar in the banking system, to put more competitive pressure on the big four banks.

Mutual bank status will help member-owned banking become more competitive and a more powerful force in the banking sector, he said.

“Teachers Credit Union’s member-owned banking values, competitiveness and unparalleled service have seen us top member satisfaction polls time and time again. Changing our name to Teachers Mutual Bank will more accurately reflect who we are and what we offer, in the public mind,” Mr James said.

“Our status as a mutual is rock-solid – we have no plans whatsoever to demutualise. We’ll continue to live the ethos and principles upon which we were founded.”

Abacus – the peak body for Australian mutuals – has welcomed the development of “mutual banks” as an important boost to competition in banking.

Abacus CEO Louise Petschler said these new developments were another sign of the ambition and strength of Australia’s mutual banking sector.

“The rise of “mutual banks‟ is about promoting diversity in the fifth pillar and encouraging more competition to the big banks – a win for Australian consumers,” said Ms Petschler.

If the vote is successful, Teachers Mutual Bank will join bankmecu and QT Mutual Bank who have already achieved mutual bank status.