The mutual delivered strong bottom-line growth in its 2025 financial year, while its home loan book remained stable.
Teachers Mutual Bank has reported a bumper year of profits, underpinned by the lender’s strategy to simplify and modernise services.
Net earnings after tax for the year to June 2025 were $36.7 million, up 49.8 per cent on the prior year.
The Sydney-based mutual's home loan book remained stable at $9.2 billion, while home loan approvals were $1.5 billion.
Net interest margin increased slightly, up 0.21 per cent to 1.86 per cent.
During the year, Teachers Mutual supported more than 3,700 members to buy a new home or refinance, including 960 first home buyers.
Across its home loan portfolio, over a quarter of members were more than a year ahead on their mortgage repayments at year end.
Speaking to The Adviser, Mark Middleton, head of third party sales at the lender, said: “Over the course of FY25, we have worked to improve the competitiveness and strength of our offer for our key target segments.
“Our low fees and competitive rates, combined with a focus on improved digital capabilities and service, has seen an increasing number of brokers choose Teachers Mutual Bank brands for their customers – and in this past financial year around 70 per cent of our home loans came through our broker network.
“Our FY25 results position us well for FY26 and already we are seeing an increase in new members refinancing with us and our current overall home lending growth is almost double system growth rate.”
Teachers Mutual CEO Anthony Hughes said the results were underpinned by the bank’s new strategy to simplify and modernise services in a bid to improve member outcomes and customer experience.
“Being member-owned, our profits are reinvested back into the bank for the benefit of our members and the communities they support. In a high cost of living environment, this year we have offered competitive products and rates, while remaining focused on making our banking experience simpler and safer and ensuring the long-term sustainability of our bank,” he said.
“This year, we focused on delivering visible and meaningful enhancements for our members. We upgraded our technology and grew our Member Contact Centre team, alongside the delivery of digital banking updates and new features enabling simpler and safer banking services.”
Looking ahead, Hughes added: “Our strong results and capital position support our continued investment into important transformation programs, and our proposed merger with Australian Mutual Bank.”
First announced in December last year, the proposed merger will bring the two banks together to create an organisation with a combined $13.4 billion in total assets.
“Merging our two trusted and financially sound banks will create a stronger, future-ready bank that can deliver greater benefits to members while helping ensure our bank’s sustainability well into the future,” Hughes finished.
“We’re well progressed in the application process and are expecting to bring the merger proposal to a member vote in 2026.”
In May, the boards of both Teachers Mutual and Australian Mutual Bank formally endorsed a proposal to recommend merging the two banks, following the completion of due diligence.
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.
The proposed merger will be submitted for regulatory approval prior to being put to members.
Over the past decade, both TMB and Australian Mutual Bank have actively participated in mutual banking sector consolidation, which has seen the number of mutual banks almost halve.
In the past three years, consolidation has accelerated, with at least eight of the largest mutual banks either merging or announcing intentions to merge.
[Related: Teachers Mutual and Australian Mutual boards endorse proposed merger]
