Big brands shed deposits
Australia's traumatic bushfire season appears to have taken a toll on deposit funding in February, with official data showing the overall flow of cash into customer accounts slowed to a trickle.
According to the latest edition of APRA's monthly banking statistics, system-wide growth in household deposits expanded by only A$1.1 billion to $989 billion.
This equates to growth of only 0.1 percent - one of the lowest monthly expansions in the last five years.
ME Bank, Westpac and National Australia Bank were among a raft of banks to lose ground.
Westpac took one of the biggest hits after suffering a $3.3 billion net outflow of retail deposits, while NAB lost $200 million.
Bank of Queensland suffered the biggest outflow among the regional banks.
BoQ's net outflow of household deposits was $127 million for the month, while its cross-town rival Suncorp managed to add $80 million to its vaults.
ME Bank, one of the most consistent market share gainers since 2018, appeared to shed a disproportionate number of customers after its base of household deposits reduced by $59 million to $8.87 billion.
Dutch-owned ING Bank, the fastest growing deposit taker of the last decade, also struggled to retain customers. Its deposit base tapered by $3 million to $36.2 billion.
The big winners in February were aggressively priced startup banks, Xinja and Judo.
Xinja was sitting on $304 million of household deposits at the end of February - up $229 million on the previous month.
However, its stellar entry in the deposits market was abruptly curtailed in the first week of March after chief executive Eric Wilson acknowledged the bank would not be able to compete as a retail lender by continuing to accept highly priced deposits.
Retail depositors handed Judo $86 million in fresh deposits to boost its retail base above $550 million.
Judo, which has a unique business model of raising retail deposits to fund higher margin business loans, is continuing to accept offers from household customers.
Perhaps the surprise performer so far this year has been ANZ, which added $500 million in February.
ANZ's retail franchise has languished in the last 24 months, but the latest data indicate the bank might have begun to escape a strategic decline.