Banking & Finance Sector in Australia
The banking industry landscape at the smaller end of the domestic market (and credit unions) has been dynamic in terms of change in recent years. Technology, growth and branding have driven the consolidation of smaller banks particularly mutuals which have been seeking to add scale and defray increased technology and compliance costs. As a result, existing banks and finance companies have M&A desire to acquire new tech or more nimble competitors.
The acquisition of Henslow client, Ferocia by Bendigo Bank (ASX:BEN) is an example of this. We continue to anticipate further M&A as established banks and finance companies seek to acquire innovation. With competition increasing in the sector, banking and finance companies seek to finance their innovative and new product offering through capital raising, to enable more flexible finance solutions. As is evident with two Henslow clients; the first Earlypay completing a $18.9m placement in June 2021 to fund their new trade finance product & Avenue Bank, Australia’s 2nd Small business focused Neobank in Australia completing $40m+ in private raising to enable their new and innovative finance solutions for Australian SMEs.