bank mecu - responsible banking

Abacus - Australian Mutuals

bankmecu is a member of Abacus.

Abacus - Australian Mutuals is the industry representative body for the Australian mutual financial services sector, an alliance of mutual building societies, credit unions and friendly societies. Abacus is owned by its member institutions. Abacus brings together the shared values and professional approach of credit unions, mutual building societies and friendly societies to deliver a strong and clear single voice for Australian mutuals. Abacus promotes the profile and role of the mutual financial services sector and represents its interests to:

• federal and state governments
• regulators, such as the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investment Commission (ASIC)
• industry and consumer groups
• the media; and
• the general public and other stakeholders.

Abacus also provides its member institutions with advice and support services, including specialist teams dealing with public affairs, overseeing representation, providing input to reforms and policy, and liaison with media and other stakeholders.

Mutual Banking Code of Practice

bankmecu is a signatory to and complies with the Mutuals Sector Code of Practice launched on 1 July 2009. The Mutual Banking Code of Practice defines how credit unions and mutual building societies will deliver on their pledge to always put members first.

The Code contains 10 promises for bankmecu to adhere to: 

1. We will be fair and ethical in our dealings with you
2. We will focus on our customers
3. We will give you clear information about our products and services
4. We will be responsible lenders
5. We will deliver high customer service and standards
6. We will deal fairly with any complaints
7. We will recognise customer rights as owners
8. We will comply with our legal and industry obligations
9. We will recognise our impact on the wider community
10. We will support and promote this Code of Practice

Political lobbying and contributions

bankmecu does not participate in direct political lobbying nor does it provide political party contributions. However, the bankmecu Board advocates through the key industry association Abacus. bankmecu also supports some non-Government organisations which do have a lobbying role. Abacus has represented the industry in the following areas during the reporting period.

Competition: Competition in the banking market remains an integral issue for Australians with the increased market dominance of the ‘big four’ banks arising from the Global Financial Crisis. Credit unions and building societies deliver professional and ethical banking to some 4.5 million Australians. These institutions are more important than ever to maintain competition and consumer choice. Abacus's efforts to lobby the government on the issue of a need for increased competition in banking contributed to the Federal Government's Banking Reform Package which included the opportunity for some credit unions and building societies to use the restricted term 'bank' in their name.

Wholesale funding guarantee and retail deposit guarantee scheme: Abacus strongly supports the continuation of the existing guarantee for deposits of up to $1 million, but some changes are needed to the guarantee arrangements applying to large deposits and wholesale funding as the fee structure is anti-competitive.

Abacus encouraged the Government to facilitate access to funding by mutual ADIs by:

• removing anti-competitive aspects of the Government’s fee arrangements for the guarantee of large deposits and wholesale funding; and taking further action to resuscitate securitisation markets;
• promoting public understanding of the prudential regulatory framework and the status of mutual ADIs within that framework;
• reducing the regulatory compliance burden on prudentially regulated and responsible lenders such as mutual ADIs; and
• supporting smaller ADIs to access wholesale funding through securitisation and other means.

National Consumer Credit Legislation: Abacus supports the aims of the new federal consumer credit laws. A single harmonised regime, a level regulatory playing field for all credit providers, and access to low cost dispute resolution are all welcome and important steps to provide protection to consumers.

Prudential issues: Abacus works on matters arising from the impact of the new Basel II capital accord to deposit insurance and APRA prudential supervision, including liquidity, governance and executive remuneration issues.

Unfair Contracts: Abacus members support harmonised laws that protect consumers from unfair contract terms. We welcome recent changes that more fairly balance the rights of lenders and consumers.

Source: http://www.abacus.org.au/policy/key-issues

Cuscal

Cuscal is a service provider to bankmecu of central banking, transactional banking, liquidity and capital management products.

Cuscal is owned by the mutual financial services sector and bankmecu is a shareholder.

Industry support system

bankmecu provides an extra degree of protection for members through participation in the Credit Union Financial Support System (CUFSS). CUFSS has been established to protect the interests of members of the organisations participating in the support system and promote financial stability by providing emergency financial support for participants.

Participants in the industry support system: 

• Cuscal is a public company limited by shares and owned by mutuals.
• CUFSS is a public company limited by guarantee, owned by all participants in the industry support system.
• Credit unions that choose to join the scheme, are authorised to conduct the business of banking in Australia under the Banking Act 1959 (Cwth) s9 and authorised under the Banking Act to use the name ‘credit union’ or ‘credit society’ in its name.

Cuscal, CUFSS and all mutual ADIs that are parties to this Industry Support Contract, are the participants in the industry support system. The support contract is APRA certified under Banking Act 1959 (Cwth) s11CB.

CUFSS’ aim is to work together with participants to identify areas of risk and distress and to take a cooperative approach to eliminating those risks.

The purpose of the industry support system Is to protect the interests of members of participating mutual ADIs; and promote financial sector stability.