FURTHER mergers of credit unions are inevitable as they to seek compete with the big banks and fill the gap left by the takeovers of St George and Bankwest, according to the head of the country's second-largest mutual finance house.
The credit union industry was likely to be made up of a small group of large players and a greater number of "niche" mutuals serving specific sectors of employees, Peter Evers, managing director of Australian Central, said yesterday.
He said that while industry research suggested the present 100 credit unions would fall to between 50 and 70 by 2017 after consolidation, the remaining operators would be strong enough to withstand the might of the big banks.
"We certainly see the competition increasing [into 2011], but we know that our members value what we are able to offer," he said. "People don't like the banks."
Mr Evers said yesterday that Australian Mutual - which merged with the larger Savings & Mutual in December - had produced a 55 per cent jump in half-year profit to $6.3 million.
The result included just one month's contribution from Savings & Loan.
Loans to members increased 113 per cent to $5.5 billion, while retail deposits were ahead 124 per cent at $3.3 billion - both the direct result of the merger, Mr Evers said.
He said that having weathered the global financial crisis, Australian Central was now looking to expand.
