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Shared Value Delivers Growth

1 August 2018 |Industry Updates

Shared Value Delivers Growth

1 August 2018 |Industry Updates

One of the challenges faced by AWA Mutual's Board was to successfully mange the transition from an industry based credit union to a social enterprise in the business of providing financial services to the broader community. This change in target audience was the result of the closure of AWA’s Geelong plant and coincided with the transition to becoming an Alliance Bank.

Under the Alliance Bank® Solution operating model AWA’s Board were able to adopt a strategy that involves partnering with community organisations such as sporting clubs, schools and social enterprises and providing them with financial support to deliver major infrastructure projects that benefit them and the broader community.

When operating as an ADI a shared value, community investment strategy was not possible given APRA restrictions.

The projects all have shared value at their core and form the foundation of an over-arching growth strategy. The social impact loans work by using member capital to fund the loan, which is then re-paid by allocating some of the revenue earned new members of AWA that are members, family and friends of the community organisation, to pay down the loan. 

Naturally part of the agreement involves a commitment by the community organisation to promote the products and services offered by AWA Alliance Bank to their members and their families and friends. This strategy is proving extremely successful across several fronts:

  • Membership growth
  • Growth in loans and deposits
  • Protection of Member Capital
  • New infrastructure that benefits the broader community
  • Better facilities which have an economic benefit across the region
  • Strengthened brand recognition and community credentials
  • Provides the organisation and its staff the ability to live their community purpose values
Graeme Scannell
Graeme Scannell
‘We couldn’t have achieved this sort of market traction and growth as an ADI. We’ve been able to successfully transition from being an industry-based credit union to one that is part of our community’s prosperity – we feed into the prosperity of our communities and not off it.'

Locals in the region are supporting us because we’re supporting community need in a demonstrable way. Our business is growing as is brand recognition and membership which all flows into the bottom line,’ says Graeme Scannell, CEO AWA Mutual Ltd.

Case Study

East Belmont Cricket Club Partnership
Funding Partnership sees Construction Underway

East Belmont Cricket Club and AWA have had strong links over a number of years.  The Club desperately needed to upgrade change rooms, public amenities and practice facilities at Winter Reserve, Belmont - the Club’s home ground.

They approached AWA who provided a social impact loan of $100k to support the change rooms and public amenities upgrade, enough seed funding to get the attention and ultimate full funding for the project with co-contributions from the Federal Government, the State Government, the City of Greater Geelong and the Belmont Lions Sports Club (which shares the facilities.)

The entire project will cost $1.2M and without the initial seed funding the East Belmont Cricket Club upgrade would not have been considered for government funding.

An additional $50k social impact loan has also been provided for a major upgrade to turf and hard wicket training facilities and with a co-contribution of $60k from the City of Greater Geelong this $130k project is on-track to deliver a significant improvement to this community asset.

The business generated by this partnership is already sufficient to cover the full loan amount of $150k provided by AWA and both projects are scheduled for completion in coming months. This partnership has greatly increased AWA Alliance Bank’s profile within the community and delivered significant business growth for them. The arrangement has also attracted other sporting organisations in the region providing new business access to these new markets.

AWA has two other projects (one which is complete and the other in progress) that are structured using the same shared value approach:

  • The restoration of the Alma Doepel (in progress), a 115 year-old tall ship that delivers sail training and support to disadvantaged youth, and
  • the construction of 6 new courts (complete) at AWA Alliance Bank Stadium for Basketball Geelong.

To date this growth strategy has delivered total loans of $31.4M and footings of $35M.

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Bendigo and Adelaide Bank Limited, ABN 11 068 049 178 AFSL / Australian Credit Licence 237879. AWA Mutual Limited®, BDCU Limited®, CIRCLE Mutual Limited®, NOVA Mutual Limited® and SERVICE ONE Mutual Limited® (Alliance partners) are independent mutual entities that have formed an alliance with Bendigo and Adelaide Bank. AWA Alliance Bank®, BDCU Alliance Bank®, CIRCLE Alliance Bank®, NOVA Alliance Bank® and SERVICE ONE Alliance Bank® are trademarks of Bendigo and Adelaide Bank Limited.

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