P&N lifts lending as mutual banks build momentum

Further, mortgages accounted for approximately 92 per cent of P&N’s total loans, underlining the importance of housing finance to its business.

The group, formally Police & Nurses Limited, said that it helped more than 1,540 Australians into home ownership over the financial year, including 171 first home buyers (FHB).

Its customer base across Western Australia, NSW, and Queensland expanded by 11,567 during the financial year to more than 206,000.

Managing director and CEO Andrew Hadley said household pressures and competition across lending markets shaped the operating environment.

“Elevated living costs and economic uncertainty continued to place pressure on households, while competition across retail and business banking remained strong,” Hadley said.

“Against this backdrop, we delivered balanced growth, improved profitability and a stronger capital position, while continuing to provide the value and personal service our customers expect.”

Merger preparations advance

P&N said the result established a “solid foundation” for its proposed merger with Bank Australia, as customer-owned lenders increasingly pursue greater investment capacity through consolidation.

The banks’ boards signed a memorandum of understanding in May, and following initial due diligence in August, both agreed to advance to regulatory submissions.

The organisations will prepare those submissions over the coming months, with eligible members expected to vote in the first half of 2027.

“Our financial position, continued investment in capability and the opportunity presented by the proposed merger leave us well placed to deliver long-term value for customers and contribute to the future of customer-owned banking,” Hadley said.

He added that greater scale would support investment without sacrificing the bank’s ownership model or members’ influence.

“As expectations for digital banking, protection from scams and cyber threats, competitive products and reliable service continue to grow, increased scale would enhance the Group’s ability to invest in these capabilities while remaining customer-owned and ensuring members retain a strong voice in the future of the organisation,” Hadley said.

P&N’s technology and operational investment over the financial year included digital document delivery and signing, real-time application tracking and streamlined settlement processes for home lending.

Hadley said digital convenience needed to be backed by access to trusted assistance.

“Customers increasingly expect banking to be convenient and connected, but they also want to know trusted support is available when they need it,” Hadley said.

“Our investment has focused on making everyday banking easier while strengthening the service, security and protection our customers rely on.”

Brokers underpin mutual lending

P&N’s expansion accompanies stronger home-lending results across the customer-owned banking sector.

Bank Australia reported a $17.6 billion mortgage book and 17.7 per cent home loan growth in FY25–26, measured against the combined Bank Australia and Qudos Bank books in FY2024–25.

Its enlarged business also reflects the Qudos merger and acquisition of Australian Unity Bank.

Bank Australia generated $3.6 billion in home loans through brokers during FY25–26, more than double the previous year, with intermediaries contributing over 80 per cent of origination value.

Meanwhile, Great Southern Bank increased home lending by 7.6 per cent to $18.78 billion in FY25–26, accelerating from FY24–25’s 6.5 per cent growth to $17.5 billion.

Brokers originated just over 80 per cent of its home lending during the year, with active brokers submitting approximately five deals each on average.

[Related: Bank Australia, P&N Group advance proposed merger to next stage]