Judo, Alex lead neobank fightback against 'big four' dominance
Bendigo Bank argued in court last year that smaller banks cannot compete effectively with the big four. Newer challengers like Judo Bank and Alex see things differently.
In defending its position as a realistic “counterfactual” bidder to ANZ for Suncorp Bank, Bendigo & Adelaide Bank, somewhat surprisingly, argued smaller institutions could not compete effectively with banking’s Four Pillars.
Outside of the Federal Court, where the Australian Competition Tribunal heard ANZ and Suncorp Group’s arguments for why the competition regulator’s knockback is wrong, you don’t really hear smaller players say they are uncompetitive.
Certainly, some of the challenger banks like People’s Bank or Judo Bank or Alex Bank would beg to differ. Alex Bank founder Simon Beitz told Capital Brief “we see a great niche for us as a challenger bank in Australia, in retail banking, and we are self-sustaining”.
But in court, barrister Nicholas De Young KC for Bendigo said of smaller banks “many have failed or are not performing well financially.” He cited Volt Bank handing back its licence as an “unsuccessful attempt to break into the Australian banking market” and Pepper Money “which has publicly said it is stepping back from the prime mortgage lending market.”
