Australia’s banking sector just got bigger—MyState’s merger with Auswide is official!

MyState Limited has successfully completed its long-anticipated merger with Auswide Bank Limited, forming a stronger regional banking institution that aims to compete more effectively with larger national players. This development marks a significant expansion for MyState, enhancing its ability to provide banking, asset finance, and wealth management solutions across Australia’s eastern seaboard.

With the MyState Auswide integration, the merged entity now has a broader geographic footprint and a larger customer base. The transaction brings together MyState, a financial services provider based in Tasmania, and Auswide, a Queensland-based bank with a strong presence in retail banking and asset finance. MyState’s Managing Director and CEO Brett Morgan highlighted that the merger would allow the company to offer customers a compelling alternative to larger banking institutions while enhancing its ability to invest in future growth initiatives.

What Are the Financial Gains from the MyState Auswide Integration?

The merger has significantly strengthened MyState’s financial position. The combined entity now manages $12.7 billion in home lending and $9.9 billion in customer deposits, establishing a more resilient and diversified balance sheet. The bank now serves approximately 272,000 customers, an increase from MyState’s 180,000 pre-merger, reflecting the expansion of its reach and services.

According to MyState’s new Chair, Sandra Birkensleigh, the regional bank merger is expected to deliver substantial long-term value to shareholders. The company has projected pre-tax cost synergies of between $20 million and $25 million annually by FY27. Additionally, the deal is expected to be EPS accretive from FY26, once integration efficiencies begin to take effect.

Despite the initial transaction and integration costs, MyState believes that the increased scale of operations will improve funding flexibility, enhance profitability, and provide a more competitive edge in the regional banking sector. This banking sector growth reinforces MyState’s commitment to strengthening its market position through strategic expansion.

How Will MyState and Auswide Customers Benefit?

The newly merged entity will operate under four brands: MyState Bank, Auswide Bank, SelfCo, and TPT Wealth, ensuring a diversified portfolio of financial services. Customers will benefit from an expanded range of banking products, improved digital banking capabilities, and increased access to financial solutions through branch networks, mobile lenders, and broker partnerships.

Morgan emphasised that the MyState Auswide integration positions the bank as a strong alternative to traditional banking giants, enabling better customer service and more competitive financial products. By leveraging the strengths of both institutions, the combined bank can now offer improved asset finance options, enhanced wealth management services, and a more comprehensive digital banking experience.

What Happens to Auswide Bank Shares and Regulatory Approvals?

As part of the merger agreement, MyState Bank Limited has acquired 100% of Auswide’s fully paid ordinary shares, making it a wholly owned subsidiary of MyState Limited. Shareholders of Auswide have received 1.112 MyState shares for each Auswide share held, finalising the exchange process.

Following the merger, Auswide Bank shares were suspended from trading on the Australian Securities Exchange (ASX) on February 10, 2025, and the company is scheduled to be delisted on February 20, 2025. This regulatory shift underscores the completion of the regional bank merger, marking the transition of Auswide’s operations under MyState’s broader financial structure.

Regulatory approvals have also been secured, ensuring that the merger adheres to all financial and governance requirements. The Australian Prudential Regulation Authority (APRA) has approved MyState Limited as the successor issuer for Auswide’s $47 million in Tier 2 subordinated notes, ensuring a smooth financial transition.

Will MyState’s Credit Ratings Be Affected by the Merger?

Credit rating agencies have confirmed that the merger will not impact MyState’s existing financial ratings. Fitch Ratings has reaffirmed MyState Limited’s issuer credit rating at ‘BBB+/F2′, while Moody’s has maintained its long-term ratings at Baa3 for MyState Limited and Baa2 for MyState Bank and Auswide Bank. Both agencies have upheld their stable outlooks for the newly merged entity, indicating confidence in its financial stability and operational outlook.

What Are the Leadership and Governance Changes Post-Merger?

With the MyState Auswide integration now complete, several leadership changes have taken effect. Brett Morgan continues in his role as Managing Director and CEO of MyState, ensuring continuity in the company’s strategic direction. Sandra Birkensleigh, previously Chair of Auswide Bank, has been appointed as the new Chair of MyState, bringing extensive experience in banking governance.

Additional board changes include the appointment of Gregory Kenny and Jacqueline Korhonen as new Non-Executive Directors, strengthening the governance structure with seasoned financial and business expertise. Former MyState Chair Vaughn Richtor remains on the board in a non-executive capacity, contributing to the long-term strategic development of the organisation.

Morgan noted that the new leadership team is committed to driving growth and successful integration. The focus in the coming years will be on leveraging the bank’s enhanced scale, optimising operational efficiencies, and expanding digital banking initiatives to attract a wider customer base.

What Does This Merger Mean for the Future of Regional Banking?

The completion of the MyState Auswide integration marks a significant moment in Australia’s banking sector growth, as regional banks consolidate to compete with major financial institutions. The enhanced scale of MyState Limited will provide greater financial flexibility, enabling investments in technology, risk management, and customer experience enhancements.

Morgan highlighted that the merged bank is well-positioned to grow its presence beyond its traditional markets, with a stronger footprint in Tasmania, Queensland, Victoria, and New South Wales. The bank’s increased exposure to high-growth regions, particularly in Queensland, is expected to drive further expansion in home lending and retail banking services.

The strategic merger also signals a shift in the Australian financial sector, where mid-sized banks are increasingly consolidating to remain competitive. By combining two well-established regional banks, MyState aims to provide Australians with a viable alternative to the country’s major banking institutions, reinforcing its commitment to customer-centric financial solutions.

The regional bank merger between MyState Limited and Auswide Bank represents a transformative move for Australia’s banking industry. With enhanced financial strength, a broader customer base, and a reinforced leadership team, MyState is poised to capitalise on new opportunities in the regional banking market. As the company moves forward, its focus will be on delivering shareholder value, expanding digital banking capabilities, and maintaining its commitment to customer service excellence.

The completion of the MyState Auswide integration sets a new benchmark for regional banking mergers, demonstrating the potential for mid-sized banks to scale operations, improve efficiency, and strengthen their competitive positioning in Australia’s evolving financial landscape.