Bank of Queensland to acquire ME Bank and wants to compete with the big four
Bank of Queensland disclosed a $ 1.325 billion deal to buy ME Bank, in a statement to the Australian Stock Exchange today.
The Bank of Queensland (BOQ) has confirmed its intention to acquire ME Bank, an industrial fund, with the aim of competing with the Big Four banks and “balancing” its presence on the east coast.
BOQ President Patrick Allaway said: “Today’s announcement is another major step in our strategy to become the leading customer-centric alternative to big banks.”
“With the addition of the ME Bank business, BOQ now has a material scale and a compelling growth platform to support this ambition.
“The combination of our highly complementary activities brings together two organizations sharing a common goal and values that generate greater value for customers, employees and shareholders,” said Mr. Allaway.
Pending regulatory approval, ME Bank will join Virgin Money Australia previously acquired in 2013.
For BOQ, the move will double the size of its retail banks, increase the value of mortgages to $ 75 million and increase its customer base to 1.5 million, revealed chief executive and CEO George Frazis.
“The acquisition of ME Bank will create a compelling alternative to the Big Four Banks,” said Frazis.
This decision was approved by ME Bank shareholders, represented by 26 industry super funds.
ME Bank Chairman James Evans said, “This agreement brings together two culturally aligned organizations to form what will be an enhanced and influential banking alternative for customers.”
Home loan clients get the best of both worlds
Currently, 75% of ME Bank’s customers are routed through third party brokers. Mortgages are his main source of income.
The acquisition will allow BOQ to offer a greater choice to different customer segments looking for a mortgage.
“What is really important for us is to help more Australians enter the homes. Different segments have different needs, ”said Frazis.
“Bank of Queensland [customers] require a more personal touch, which is why agency managers are important. Virgin Money is all broker and ME Bank is primarily a broker. “
Those who benefit from face-to-face customer service can still be served by the branch managers of the BOQ. Young Australians who prefer to bank on their phone or laptop can find solace with the online platforms of Virgin Money and ME Bank.
Mr. Frazis also referred to the launch of his cloud-based “state-of-the-art” banking system to be launched next month. This new system is expected to allow BOQ, Virgin Money and ME Bank to allow brokers to transparently track home loan applications and allow clients to make changes in a shorter time frame.
What does this mean for ME Bank customers?
Simply put, it will be business as usual for ME Bank customers, as bank chairman James Evans has confirmed.
“ME customers will be able to enjoy the same simple and straightforward products and services that we know they expect from ME Bank, as well as the added benefits of being part of a larger bank,” said Evans.
But it should be borne in mind that customers may have more options when it comes to refinancing mortgages or even opening a new bank or savings account.
Customers will still need to meet all eligibility criteria, but thanks to the implementation of its cloud-based banking system next month, a ME Bank customer can find opening a BOQ savings account. , for example, a much easier and potentially streamlined process.
For example, the Bank of Queensland currently offers one of the most competitive savings account rates on the market for young Australians. People aged 14 to 24 can apply for Fast Track Starter Account with a massive 3% bonus interest rate.
Home loan clients may also be interested in how BOQ and ME Bank’s interest rates also compare, while news of the proportion of ME Bank’s home loans channeled through brokers may mean that those applying for a home loan through ME Bank may be well advised to consider their own broker, or just shop for their best price all the same.
Lowest homeowner principal and interest loans:
Source: RateCity.com.au. Data correct as of 22.02.2021.