The Lutheran Laypeople’s League of Australia (LLL Australia) has been granted an authorised deposit-taking (ADI) licence by the Australian Prudential Regulation Authority.
The LLL Australia, founded in 1921, previously operated as a religious charitable development fund with exemptions from the Banking Act and certain class orders. However, in August 2016, the organisation was notified of regulatory changes that would impact the way charitable organisations must operate.
“As a result of these regulatory changes, the LLL board made the strategic decision to apply to become an [ADI] and be fully regulated under the Banking Act, meaning the LLL can continue to offer at-call savings accounts in support of the Lutheran Church,” the new ADI said.
It now manages more than $1.1 billion in depositor funds, with over $124 million in reserves and about $300 million in loans to Lutheran schools, congregations, and aged care projects. Currently, the LLL Australia lends about $10 million annually to support these schools, congregations and aged care initiatives.
The CEO of LLL Australia, Allen Kupke, said there would be no changes to daily operations as it would continue operating as a charitable financial institution, but in an “even more secure” and fully regulated environment. There will also be no changes to its staff or board.
The financial institution said becoming an ADI will “strengthen” its governance and risk management practices and “provide greater security” for its depositors’ funds.
[Related: Challenger bank gains full ADI licence]