Community banking: a new type of deposit taking institution in Australia

The general public has expressed a great deal of dissatisfaction with Australia's major banks. A particular manifestation of this dissatisfaction has been customers' anger about the closure of bank branches in both rural and suburban centres (1706 bank branches in Australia were closed between June 1993 and June 1999). The banks for their part have pointed out that customers are increasingly making use of electronic banking, which has reduced the need to maintain branch networks. The banks have also argued that they must reduce their operating costs in order to ward off the threat of further low cost entrants, such as the mortgage originators, who presumably will be unencumbered by expensive, labour intensive branch networks.