The G&C Mutual Bank and Unity Bank Merger: A Rocky Start
The merger of Sydney-based mutuals, G&C Mutual Bank and Unity Bank, has hit a rough patch. The partnership, which began in March and officially adopted the Unity Bank name in July, has not seen the expected growth in the mortgage book and household deposits, six months post-merger.
A History of Collaboration
G&C Mutual Bank and Unity Bank have always been known in the sector as close collaborators. They had previously considered merging in 2020, but the plan was put on hold due to the uncertainties and challenges brought about by the global pandemic. The decision to merge was finally realized early this year, with the hope of fortifying their market position and expanding their offerings.
Stagnant Growth
However, the Australian Prudential Regulation Authority’s (APRA) monthly banking statistics show zero growth in the mortgage book and household deposits in the six months since the merger. As of the end of February 2025, the combined mortgage book of the then separate banks stood at $2.35 billion, and the combined household deposit book was $2.18 billion. Six months into the merger, by the end of August, the numbers showed minimal growth, with the mortgage book at $2.36 billion and the deposit book at $2.22 billion.
Management’s Take
Danny Pavisic, the CEO of the merged entity, addressed the concern, stating, “We certainly grew in September, and we are going to have growth this month.” It is worth noting that Pavisic, who was previously the CEO of Unity Bank, is set to step down from his position in March next year. He will be succeeded by Rosanna Argall, who is currently the deputy CEO and former CEO of G&C Mutual Bank.
Financial Performance
Despite the stagnation in growth, the bank’s net profit for the year to June 2025 was $15.1 million. The return on assets was 0.6 per cent, and the return on equity was 8.2 per cent, positioning Unity Bank as one of the best performers in the sector. The bank currently holds assets worth $3.8 billion.
Given the circumstances surrounding the merger, the challenge lies in maintaining the growth momentum in an increasingly competitive market. The banking industry will be watching closely to see how the new leadership under Argall will navigate these challenges and steer the bank towards continued success.
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