Did you know that Credit Unions are subject to the same prudential standards as the banks?  The only difference between us and the banks is that we are member owned.

When you join Family First Credit Union, you are not just a customer. You are our member and Family First Credit Union is run by our members.

When you buy your share when establishing your membership, you become a part owner - on equal standing with every other member. This means we are not subject to pressure from external shareholders to increase our profits. Our profits belong to our members and are returned through better interest rates, lower fees and increased services.

You may be aware of media attention focused on the mortgage market pressures in the US and UK and hence Austrailia.  We would like to assure our members that we are not subject to the pressures that face some Australian lenders as we fund our members' loans from our members' deposits. 

Take a look at our recent press release below to find out more.

Credit Unions, Building Societies and Banks less exposed to wholesale market volatility

Credit unions and mutual building societies do not have the same exposure to volatile wholesale markets as nonprudentially regulated lenders such as RAMS, Resi, Wizard, Liberty and Bluestone, John Paine, Family First Credit Union’s General Manager said today.

“Credit unions and mutual building societies are not included in the category of ‘non-bank lenders’ that have been the focus of recent media attention,” said Mr Paine.

Credit unions and building societies,along with banks, are Authorised Deposit-taking Institutions (ADIs) subject to the same regulatory standards under the Banking Act 1959 and overview by the Australian Prudential Regulation Authority (APRA). Other lenders in the market – non-ADI lenders – are not subject to prudential standards.

Referring to media coverage of the impact on home loan interest rates in Australia from developments in overseas lending markets, Mr Paine explained that credit unions do not fund the bulk of lending from wholesale and overseas sources, as is the practice of non-prudentially regulated lenders.

“Credit unions and mutual building societies source the bulk of their funding from retained earnings and deposits” said Mr Paine.

“While the interest rates will always be subject to variation, credit unions and mutual building societies do not have the same exposure as non-ADI lenders to volatile wholesale markets.”

There are 150 credit unions and mutual building societies in Australia, owned by and operated for more than 4.5 million members nationwide. As ADIs, credit unions meet the same prudential standards as the major banks.

In addition to their status as ADIs regulated by APRA, credit unions are Australian Financial Services Licensees regulated by ASIC, and are subject to the Uniform Consumer Credit Code and the Electronic Funds Transfer Code.