Community Bank® boosts regional jobs
Bendigo Bank will create more than 200 new jobs in regional Australia as it expands its Community Bank® program.
Group Managing Director Rob Hunt said the expansion, which follows the success of the first 20 Community Bank® sites, would double the rate at which new branches were opening.
Bendigo would target a total of 50 to 60 Community Bank® branches by the end of next year.
"At that point, we anticipate Community Bank® will achieve a billion dollar business for our Group," Mr Hunt said.
"We have already achieved almost one-third of this figure through the 20 branches currently operating and some of these have only been open for a few months.
"Although this is not a large proportion of our total business at the moment, we see Community Banking as a market in which Bendigo can excel in the delivery of banking and other services."
Mr Hunt said Bendigo Bank directors had confirmed Community Bank® as being a key opportunity in the Bank's growth strategy as well as confirming Bendigo's strengths.
"It should be remembered that just 18 months ago, Community Bank® was still in the pilot stage. It has quickly proven its viability and is now highly successful for both Bendigo and the communities with which we are working.
"Given its growing contribution to Group profit, and the clear prospects created by growing demand from communities committed to improving their prospects, the Board has determined it will increase resources allocated to the project.
"The expansion we announce today will over the next 18 months create 30 new jobs at our Bendigo headquarters and a further 200-plus jobs through the Community Bank® branch network.
"It represents a multi-million dollar boost to regional economies on top of the 100-plus jobs Community Bank® has already created."
Mr Hunt said 15 Community Bank® branches had been opened across four states during 1999.
"While this represented a significant achievement for those communities and Bendigo Bank, it still fell far short of the demand which now exists. We have received more than 600 inquiries from across Australia and the rate of inquiry continues unabated.
"In response, we will seek to more than double the rate at which branches are opening.
"This would result in 50 or more community-operated branches by the end of 2001, which would see community branches comprising more than one-third of Bendigo's branch network."
Mr Hunt said Bendigo would try to streamline the process for bringing new communities on-line.
"We freely admit we have been learning as we go. Supporting a community raising start-up capital in the order of $300,000 is intensive work; people must be totally comfortable with the process and so we will continue to work at the pace which suits each individual community.
"But we will also seek to refine the process to bring the current nine-month average project time down to more like six months.
"This timeframe has just been achieved by the Nathalia community and we will model our future developments on their efforts."
Mr Hunt said a growing confidence was apparent in communities now preparing business plans.
"Leaders of our early communities saw that Bendigo's Community Banking model was sound as long as they could mobilise local demand and channel it through their banking shop.
"Now, other communities can see the runs on the board. Eight of the 19 branches operating by January this year were making monthly surpluses, some after less than a year's trading.
"The community of Upwey, near Melbourne, is now consistently making more than $10,000 a month and other towns are steadily building their profitability.
"All branches are growing steadily in line with their business plans.
"New communities are talking with their leaders to understand the responsibilities they are taking on but equally the rewards which are on offer. The result is that an investment target of $300,000 is being easily achieved by united communities and some are pushing on beyond the $400,000 mark to provide themselves with more working capital."
Mr Hunt said that having secured the success of phase one of Community Bank®, Bendigo continued to develop co-operatively-spirited, commercially-based models which would deliver further benefits to its communities.
"Bendigo's original motive in creating this new model was that it would deliver much more than just securing branch banking services at a community level."
Twenty Community Banks currently operate across four states - Victoria, NSW, South Australia and Western Australia.
A further nine branches are confirmed to open and Bendigo Bank is assisting a further 25 communities to raise capital and prepare business plans.