I recently attended a talk by BOQ CEO Stuart Grimshaw. He argued that regional banks were at a structural disadvantage against the 4 largest banks.
He pointed to the 4 banks’ annual combined profit of more than $24billion; yet smaller ADI’s had to provide up to 3 times as much capital for housing loans.
Whilst he acknowledged that mutuals had the same disadvantage, he avoided putting regional banks and credit unions in the same category (after all BOQ has assets of $42bn).
Separately, APRA is yet to respond to submissions from mutuals for capital instruments that would meet the Basel III capital requirements.