Banking industry in Australia - statistics & facts
The banking industry in Australia has developed greatly since its humble beginnings. In 1817, the first bank in the country, the Bank of New South Wales, was established. From then on, many additional local and a few foreign banks were set up, with mergers and acquisitions continually changing the sector's landscape. While the banking sector in the country is now dominated by four major banks, commonly known as ‘The Big Four’, there are now almost 100 different banks operating in Australia. The Australian banking sector is actively embracing the evolving financial technology to keep pace with the modern digital world.
With online banking becoming the norm for most people in Australia, and the growing fintech industry changing how many industries do business, Australian banks will need to ensure that they keep pace with these developments. In particular, the Big Four banks will have to be at the forefront of these changes in order to maintain their dominance over the banking sector in Australia.
Australia's banking sector dominated by the Big Four
Bank acquisitions throughout the 70s and 80s led to a few larger banks. Due to growing concern and political pressure regarding the shrinking number of large banks operating in the market, the Australian government adopted the "four pillars policy" in 1990. The policy was implemented to stop mergers between the country's Big Four banks. Today, the Big Four banks are ANZ Bank, Commonwealth Bank, National Australia Bank, and Westpac, with CommBank leading the pack in terms of market capitalization. Aside from the Big Four, there are a number of smaller banks in Australia, though none come close to the size of the major banks. These large banks also have a reasonably high consumer satisfaction level, though there is a growing concern over the virtual monopoly these large entities have over the banking sector.Banking on technology
The future of banking in Australia will change drastically over the coming decade. Banking services are already accessible online, with the number of active online banking users around the world having grown significantly over the last few years. The evolving financial technology (fintech) sector will likely lead to changes in the industry, while demographic, socio-economic, and regulation factors will also play a significant role in shaping the banking industry across the country. The Internet of Things, cloud computing, artificial intelligence in business, and 5G are just a few of the technological capabilities predicted to impact the banking sector in the coming years.With online banking becoming the norm for most people in Australia, and the growing fintech industry changing how many industries do business, Australian banks will need to ensure that they keep pace with these developments. In particular, the Big Four banks will have to be at the forefront of these changes in order to maintain their dominance over the banking sector in Australia.
