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Judo Capital Holdings (ASX: JDO) has capped off five years since securing its banking licence with its loan book shooting past the $10 billion mark and the group declaring a maturing business that can no longer be classed as a startup.
The business-banking specialist says the milestone achievement represents an average growth rate of 135 per cent a year since April 2019 when the challenger bank secured its licence from the Australian Prudential Regulation Authority (APRA).
The parent company of Judo Bank, which was buoyed earlier this month by securing an upgrade to its S&P issuer credit rating, revealed a loan book of $9.7 billion at the end of December when it announced its half-year results in February. This was up from $7.5 billion a year earlier.
Judo Bank CEO Chris Bayliss says the $10 billion milestone is the result of “the hard work of our exceptional team”.
“We have clearly proven the value of our specialist small and medium-sized business (SME) lending value proposition, which is built on strong relationships with experienced business bankers, who understand their customers’ needs and are empowered to make lending decisions,” he says.
“Alongside this, we have also built a multi-award-winning deposit franchise. Our term deposit balance is now $7.5 billion.”
The term deposit balance is up from $6.9 billion at the end of December, which represented $1 billion in year-on-year growth.
“These milestones coincide with the five-year anniversary of receiving our banking licence from APRA and becoming an authorised deposit-taking institution (ADI),” says Bayliss.
“The growth we have achieved since becoming an ADI is exceptional. We cannot find another bank that has achieved what we have achieved, starting from scratch, anywhere else in the world.”
Bayliss says Judo Bank was “founded on a blank sheet of paper back in 2015” and today has 135 SME business bankers in 18 locations, supporting more than 4,000 customers.
“Judo Bank is no longer a startup, and as we move now from building to scaling our bank, our opportunities will grow,” says Bayliss. “We are an established player in the Australian banking landscape.”
Judo Bank has weathered the many challenges faced by bank startups in recent years that led to the collapse of neobanks Volt and Xinja in 2022 and 2020 respectively.
Judo posted a net profit of $45.9 million in the first half of FY23, up 27 per cent from a year earlier, as net banking income jumped 21 per cent to $200 million.
“Judo has successfully navigated through five years of financial and economic cycles, hitting our targets within strong risk settings, in what has at times been a very challenging environment,” says Judo’s chairman Peter Hodgson.
“Building a bank is now in the rearview mirror for Judo, as we turn to scale, and all the opportunities that size will bring for our bank.”
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