Town to bank on Bendigo

Com­mu­nity own­er­ship pre­ferred

Southern Riverina news - - FRONT PAGE -

Ber­ri­gan is ex­pected to con­tinue hav­ing ac­cess to bank­ing ser­vices in the town.

In­ves­ti­ga­tions have be­gun into es­tab­lish­ing a Bendigo Com­mu­nity Bank branch, fol­low­ing a pub­lic meet­ing held last Wed­nes­day.

Bendigo Bank has com­mit­ted to pro­vid­ing a tem­po­rary bank­ing agency while ne­go­ti­a­tions take place.

It will re­place the Na­tional Aus­tralia Bank branch, the only bank in Ber­ri­gan, which an­nounced in April it will close on July 7.

Ber­ri­gan Com­mu­nity Bank Steer­ing Com­mit­tee mem­ber Rob Clark said the end goal now was to have a bank­ing branch owned by the com­mu­nity.

But he said it would only work if there was sup­port from lo­cals in the es­tab­lish­ment process.

‘‘There will be a need for com­mu­nity in­vest­ment in the es­tab­lish­ment of the branch, which must also sat­isfy com­mer­cial tar­gets be­fore it can be pur­sued.

‘‘Last week’s meet­ing was made aware that for a Bendigo Bank to be vi­able lo­cals will have to, over time, es­tab­lish a bank­ing re­la­tion­ship with the Bendigo Bank,’’ Mr Clark said.

‘‘Those at the meet­ing ac­cepted that, and I am pleased to say that by a show of hands a unan­i­mous de­ci­sion was reached in sup­port of the mo­tion (to form the com­mu­nity bank).

‘‘Ninety peo­ple at­tended, which is greater than 10 per cent of the town’s adult pop­u­la­tion. A show of hands was called for with about 75 per cent of the at­ten­dees in­di­cat­ing they cur­rently bank with the NAB.

‘‘A com­mu­nity bank un­der the aus­pices of the Bendigo Bank is in ef­fect a com­mu­nity owned and op­er­ated fran­chise, that op­er­ates un­der the Bendigo Bank bank­ing li­cence.’’

Mr Clark said there was still a lot of work to be done be­fore the new bank­ing ser­vice could be se­cured. It will in­clude fea­si­bil­ity stud­ies and se­cur­ing share­holder cus­tomers to fund the branch.

Mr Clark said be­fore the fea­si­bil­ity stage can be­gin, Bendigo Bank will seek a pledge from com­mu­nity mem­bers in be­com­ing share­hold­ers.

‘‘The pledge stage is the op­por­tu­nity for the lo­cal com­mu­nity mem­bers to in­di­cate their will­ing­ness to be a fu­ture share­holder and or cus­tomer,’’ Mr Clark said.

‘‘With­out suf­fi­cient com­mu­nity sup­port the branch will not go ahead. There is the crit­i­cal need for the agri sec­tor and com­mer­cial busi­nesses to come on board and be part of the com­mu­nity’s goal of main­tain­ing bank­ing ser­vices in Ber­ri­gan and sur­rounds through a lo­cal com­mu­nity bank.

‘‘Once the com­mu­nity has pledged their sup­port, com­mu­nity mem­bers will re­ceive a sur­vey which helps the lo­cal com­mit­tee de­ter­mine if there is enough bank­ing busi­ness avail­able to en­sure the vi­a­bil­ity of a Com­mu­nity Bank branch.’’

Mr Clark said if the fea­si­bil­ity study shows pos­i­tive re­sults, com­mu­nity mem­bers will then be asked to in­vest by pur­chas­ing shares in the lo­cal com­pany.

‘‘Shares would have a value of $1 and be pur­chased in bun­dles of about 500, up to about 10,000 shares. No one en­tity can hold any more than 10 per cent of the cap­i­tal.

‘‘Prof­its from the en­ter­prise are split 50:50 with Bendigo Bank, and the lo­cal profit is split as 20 per cent as div­i­dends to the share­hold­ers and 80 per cent di­rected to com­mu­nity projects as de­ter­mined by the board of di­rec­tors.

‘‘As in any in­vest­ment there is the risk that the value of the is­sued share may rise or fall depending on the prof­itabil­ity of the lo­cal Com­mu­nity Bank.’’

It is an­tic­i­pated the branch would be staffed by a man­ager with ex­per­tise in agri­cul­tural and busi­ness loans, who is sup­ported by lo­cal tell­ers.

The other op­tion ex­plored by the ini­tial ac­tion group that was formed fol­low­ing the NAB an­nounce­ment was a part­ner­ship with the Cen­tral Mur­ray Credit Union, but Mr Clark said Bendigo Bank’s com­mu­nity model was more en­tic­ing.

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