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With due diligence having been completed on another mutual merger, both boards are now recommending that the deal proceed.
The boards of both Teachers Mutual Bank Limited (TMB) and Australian Mutual Bank Limited (AMB) have formally endorsed the proposal to recommend merging the two mutual banks, following the completion of a comprehensive and successful due diligence process.
If members vote in favour of the scheme (expected in 2026) and all regulatory approvals are met, the two longstanding mutuals would increase their customer base to over 300,000 and have combined assets of $13.4 billion.
The proposed merger will now be submitted for regulatory approval prior to being put to members for approval.
What would a merged entity look like?
Teachers Mutual Bank Limited and Australian Mutual Bank Limited first announced their intent to explore a merger in December 2024 with a Memorandum of Understanding, aiming to combine the strengths of both institutions to better serve their members.
The merger aims to combine the strengths of both institutions, allowing for increased investment into member service, better products, and enhanced fraud and scam prevention technology. It also represents a strategic decision to combine two mutual banks with a focus on meeting the needs of their members and the vocations and communities that support them.
The merged organisations are expected to continue operating under their existing brands, ensuring familiarity for members.
Both banks have committed to maintaining their existing branch networks, which means members will have access to a combined 13 branches (up from seven at TMB and six at AMB today), almost doubling the current access to face-to-face services for each bank’s members.
The CEO of the combined institution will be Anthony Hughes, the current CEO of Teachers Mutual Bank Limited, with Mark Worthington, the current CEO of Australian Mutual Bank Limited, providing support in the initial months post-merger.
It is proposed an integrated board will govern the merged entity, with Andrew Kearnan (TMB) as inaugural chair, and representation from both banks to ensure retention of skills and experience.
Broader career opportunities are expected to be created for the combined 750 employees with no forced redundancies as a result of the merger.
‘A stronger bank for our members’
Noting the board approvals, Anthony Hughes, the CEO of Teachers Mutual Bank Limited, said: “This decision marks an important step towards bringing together our values-driven banks and our approach of putting our members first. Together, we can do even more for our members while remaining 100% member-owned. The due diligence process has confirmed our initial view that this is the right time to bring together our two banks.”
Hughes added: “By coming together, we will combine our resources and financial strength to create a stronger bank. This will enhance our ability to deliver excellence in member service, exceptional value, great services, and meaningful support for the vocations and communities that support us.”
The Australian Mutual Bank CEO, Mark Worthington, said: “As mutual banks, our driving purpose is to provide ethical and valuable banking services to Australians. Now is the right time to bring our two mutual banks together to create strength and ensure long-term sustainability while maintaining both banks’ values.
“Our banks have strong strategic alignment, and merging puts us in a fantastic position—both today and in the long term—to continue to be a challenger in the Australian banking sector.”
The combined entity will retain its B Corporation Certification and continue its ‘profit for purpose’ approach.
Mutual merger mania
Over the past decade, both Teachers Mutual Bank Limited and Australian Mutual Bank Limited have actively participated in mutual banking sector consolidation, which has seen the number of mutual banks almost halved. In the past three years, consolidation has accelerated, with eight of the largest mutual banks either merging or announcing intentions to merge.
Earlier this year, for example, members of Bank Australia and Qudos Bank voted in favour of their proposed merger, which would create a group with a combined total of over $17.5 billion in assets, serving 300,000 customers in Australia across an expanded 15-branch network across NSW, Victoria, Queensland, and the ACT. That merger is anticipated to be legally complete around 1 July 2025, subject to final regulatory approvals.
Other mergers in the mutual space still underway include the recently announced board endorsement of the proposed merger between Regional Australia Bank and Summerland Bank.
Several other mutuals have completed their mergers earlier this year, including G&C Mutual Bank and Unity Bank in March (which will consolidate to become Unity Bank Limited from 1 July 2025).
Other notable mergers in the customer-owned banks recently include People’s Choice and Heritage Bank, now known as People’s First.
[Related: Teachers Mutual explores merger with another bank]
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