SGE preps bank option

SGE Credit Union is taking steps to adopt a mutual bank status.

The credit union, which mostly serves health workers in New South Wales, plans to change its incorporated name to SGE Mutual Limited at its Annual General Meeting next week.

In its annual report, SGE said that it "initiated a comprehensive branding review in February 2013."

"A major objective of that review was to strengthen the credit union's attractiveness to younger members, and in that context SGE is now actively investigating the use of new business names that include the term 'mutual bank'."

Ten other credit unions and building societies have taken this step.

It said "a shortlist of business names will be finalised later this year, at which time SGE members will be invited to express their views and preferences on those names."

SGE is also scouting for a merger partner. The Sydney-based mutual has explored a merger over the last year with Armidale-based Community Mutual, though that is now on the back-burner.

"In considering potential merger partners, SGE's priority is to identify options that will improve the sustainability of SGE's member products and services over the long term, while still allowing retention of a mutual ownership structure," Dave Taylor, the chief executive, wrote in the annual report.

SGE reported a 30 per cent decline in net profit, to A$2.7 million, over the year to June 2013.

One operational highlight was a lift in deposits of nine per cent.

The annual report also highlighted that "SGE continues to have the highest capital ratio among the largest 30 mutual financial institutions" - it is in excess of 22 per cent.