Chairman of the Country Mayors Association of NSW (CMA) Mayor Rick Firman OAM has welcomed an undertaking by the Big Four (banks) to keep regional branches open until at least mid-2027.
“The announcement that the Federal Government has struck a deal with the Commonwealth Bank, NAB, Westpac and ANZ to halt regional bank closures until at least July 2027 is good news for rural and regional Australia,” Mayor Firman said.
“This is a step in the right direction” Mayor Firman added, “Our Members applaud the work that the Federal Government has undertaken to deliver this outcome through on-going negotiations with the Big Four.”
“Banking services are integral to the economic growth of any community. Australia Post is often left to fill the gaping holes created when banks close, and they do their very best, but no-one could ever consider that they are an adequate replacement for a full-service bank,” Mayor Firman said.
According to the Australian Government, about 36% of bank branches in regional Australia have closed since 2017, leaving many communities without access to a full suite of banking services. The banks have increasingly relied on Australia Post to provide basic banking services like withdrawing cash or checking balances. Banks are also relying on customers turning to self-service, by choosing to conduct all their banking online or via phone, an approach that is creating difficulties for older residents of rural communities.
“Online, phone and Australia Post options do not adequately fill the gap left when a bank in a rural or regional community closes,” Mayor Firman said. “Banks are far more than storage locations for people’s money. They are the places small businesses go to talk about expansion, they are where farmers go to talk about purchasing new equipment or increasing their operations, they are the places people turn to, to help make decisions about buying a home or investment property and of course they employ local residents.”
“It is baffling to consider that at a time when many regional locations in Australia are basking in a post-COVID population growth spurt, that banks, the backbone of a regional economy are still contemplating closures,” Mayor Firman said.
Australian banks are frequently touted as the most profitable in the world. According to KPMG the Big Four made a combined profit after tax of over $29 billion in 2023. Nevertheless, regional bank closures are a constant threat.
“While our CMA Members appreciate that the major banks have a responsibility to their shareholders to make money, we question what the real impact on the bottom line is when it comes to keeping a regional bank open,” Mayor Firman said. “Many banks in rural towns shut at lunchtime, have a workforce of 2-3 and no longer boast the presence of a bank manager. However, even with services reduced to that extent, it is better for the community to have the bank than it is for it to close.”
‘The CMA Board will seek every opportunity to press the case for keeping rural and regional bank branches open. We would welcome the opportunity to work with the Federal Government on co-designing approaches to addressing the problem’, Mayor Firman concluded.