The Australian Prudential Regulation Authority (APRA) has approved Avenue Bank Limited to operate as a restricted authorised deposit-taking institution (RADI) and Avenue Hold Limited as a non-operating holding company.
The business bank is founded by Dale Hurley and Colin Porter (who also founded credit reporting company CreditorWatch) while former CBA executive general manager of client solutions, George Confos, is the chief executive of the neobank.
Avenue Bank aims to focus on cash-flow finance, with 48-hour pre-approvals.
Mortgage veterans including Liberty founder Sherman Ma are also on its board – with Liberty Financial Group also being a backer of the business.
Earlier this year, Avenue Bank closed a $37 million Series B funding round to help it gear for launch.
Speaking at the time, Mr Confos said: “Our mission remains the same and we aim to explore more ways to leverage our status as a bank, offering unique services in the market, upon becoming an ADI.
“Avenue’s innovative and digitally enabled product suite will deliver a much-needed cash injection to help Australian businesses. We’re solving real problems for real people, focusing initially on small and medium sized enterprises.
“The impacts of the COVID-19 pandemic have made our value proposition even more pronounced, particularly as government support schemes run off and business activity slowly picks up.”
Other members of the leadership team include:
- Peita Piper, COO (and founding member of UBank) and
- Jacqui McPherson, CIO (former CIO of Xinja)*
The new RADI has been granted under the Banking Act 1959.
The restricted ADI path provides eligible applicants with a restricted licence for a maximum of two years before they must meet the prudential framework in full.
The licence permits them to conduct limited banking business while developing their capabilities and resources, and allows them to enter the banking industry without “materially” reducing entry standards, according to APRA.
Restricted ADIs are subject to a deposit limit of $2 million on the aggregate balance of all protected accounts, and a deposit limit of $250,000 on the aggregate balance of all protected accounts held by an individual account holder.
They are also subject to limits on the level of tier one capital, assets and liabilities, and the assets held on the licensees’ balance sheets.
Those who are unable to meet prudential framework requirements within two years would be required to exit the banking industry.
Avenue Bank is the latest RADI to be announced, following Alex Bank earlier this year.
* the leadership team list was updated on 9 September to remove Raf Uy and Ji He Moon, who no longer work on the leadership team at Avenue Bank.
[Related: New banks must have money-maker: APRA]
Annie Kane is the editor of The Adviser and Mortgage Business.
As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts.