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Judo Bank is an Australian
neobank A neobank is a type of direct bank that operates exclusively using online banking without traditional physical branches. They challenge traditional banks. In contrast to direct banks, in many cases, neobanks do not have their own banking license ...
focused on
small and medium-sized enterprise Small and medium-sized enterprises (SMEs) or small and medium-sized businesses (SMBs) are businesses whose personnel and revenue numbers fall below certain limits. The abbreviation "SME" is used by many national agencies and international organizat ...
lending but also offers a range of personal
term deposit A time deposit or term deposit (also known as a certificate of deposit in the United States, and as a guaranteed investment certificate in Canada) is a deposit in a financial institution with a specific maturity date or a period to maturity, co ...
products to consumers. , Judo Bank had lent $1B to Australian businesses and another $1B in digital retail term deposits.


History


Foundation 2016-2019

Judo was founded in 2016 with an initial seed investment from an Australian consortium of family offices, led by businessman
Geoff Lord Geoffrey Fredrick Lord (born March 28 1945) is an Australian businessman and investor, best known as the founder, chairman, and chief executive of the Belgravia Group. Lord is currently chairman or director of several publicly listed compan ...
. It did a capital raising in 2018, the largest in Australia at that time, and launched as Judo Capital, raising more than $140 million from Australian and international investors, coordinated by Ironbridge Capital. At this time a number of global investors bought shares in the bank, these included Ironbridge Capital, Canadian pension fund manager
OPTrust OPTrust, officially the OPSEU Pension Trust, is a legal trust formed by the contractual agreement between the two plan sponsors, Ontario Public Service Employees Union ( OPSEU) and the Government of Ontario. It manages one of Canada's largest pe ...
, Myer Family Investments, Abu Dhabi Capital Group, Zhong Yi Investment and
Credit Suisse Credit Suisse Group AG (, ) was a global Investment banking, investment bank and financial services firm founded and based in Switzerland. According to UBS, eventually Credit Suisse was to be fully integrated into UBS. While the integration ...
Asset Management, Cambooya, Inception Asset Management, Esson and CH Warman Group. That same year, former Australian Treasury Secretary John Fraser joined the board alongside former Federal Small Business Minister
Bruce Billson Bruce Fredrick Billson (born 26 January 1966) is an Australian former politician. A member of the Liberal Party, he was a member of the House of Representatives for Dunkley, a Melbourne seat, from 1996 to 2016 and held ministerial office in the ...
.
Credit Suisse Credit Suisse Group AG (, ) was a global Investment banking, investment bank and financial services firm founded and based in Switzerland. According to UBS, eventually Credit Suisse was to be fully integrated into UBS. While the integration ...
increased their interest in Judo with a $350 million debt facility. This was followed by a $100 million facility from
Goldman Sachs The Goldman Sachs Group, Inc. ( ) is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered in Lower Manhattan in New York City, with regional headquarters in many internationa ...
in April 2019.


Licensing 2019

In April 2019, The
Australian Prudential Regulation Authority The Australian Prudential Regulation Authority (APRA) is a statutory authority of the Australian Government and the prudential regulator of the Australian financial services industry. APRA was established on 1 July 1998 in response to the recom ...
announced it had granted Judo Bank Pty Ltd a licence to operate as an
authorised deposit-taking institution Financial institutions in Australia are only permitted to accept deposits from the public if they are authorised deposit-taking institutions (ADIs). The ADI’s authority is granted by the Australian Prudential Regulation Authority (APRA) under the ...
(ADI) without restriction following its application in May 2018. As part of the licence grant, the business changed its name from Judo Capital to Judo Bank.


Further investment and growth 2019-

In June 2019, Judo Bank closed
series B round A venture round is a type of funding round used for venture capital financing, by which startup companies obtain investment, generally from venture capitalists and other institutional investors. The availability of venture funding is among the p ...
raising $400 million, new investors now include the Paris and London fund
Tikehau Capital Tikehau (meaning ''Peaceful Landing'' in TuamotuanOfficial Tikehau Tourism Site< ...
, and the Boston-based alternative investment firm
Bain Capital Bain Capital, LP is an American Investment company, private investment firm based in Boston, Massachusetts, Boston, Massachusetts, with around $185 billion of assets under management. It specializes in private equity, venture capital, credit, p ...
. On Thursday, 2 April 2020, The Australian government announced that it would invest an initial $250 million into Judo Bank's lending warehouse through the Australian Office of Financial Management's (AOFM) Australian Business Securitisation Fund and a further $250 million through its recently announced Structured Finance Support Fund (SFSF). The investment from the AOFM made Judo Bank the first recipient of capital from the government's $2 billion small and medium enterprise funding scheme that was unveiled in November 2018. In May 2020, Judo Bank had raised $230 million in fresh equity from existing investors at a post-money valuation of over $1 billion, giving the bank Unicorn status. Judo Bank was the first of the Australian
challenger bank Challenger banks are small, recently created retail banks that compete directly with the longer-established banks in the UK, sometimes by specialising in areas underserved by the "big four" banks (Barclays, HSBC, Lloyds Banking Group, and NatWe ...
s to reach this position. In December 2020, Judo Bank was ranked among the top 10 independent
neo-bank A neobank is a type of direct bank that operates exclusively using online banking without traditional physical branches. They challenge traditional banks. In contrast to direct banks, in many cases, neobanks do not have their own banking licenses ...
s globally by WhiteSight's Top 20 neo-banks of 2020 research, which based the ranking of the neo-banks on valuation. Judo Bank was the only Australian bank to rank among the top 10 neo-banks.


Operations

Judo follows the SME
challenger bank Challenger banks are small, recently created retail banks that compete directly with the longer-established banks in the UK, sometimes by specialising in areas underserved by the "big four" banks (Barclays, HSBC, Lloyds Banking Group, and NatWe ...
model developed by
Aldermore Aldermore Bank plc is a retail bank which provides financial services to small and medium-sized businesses and personal customers. It was founded in 2009 and listed on the London Stock Exchange in March 2015. It was a constituent of the FTSE 250 ...
,
Shawbrook Bank Shawbrook Bank Limited is a retail and commercial bank in the United Kingdom. It is an operating entity of Shawbrook Group plc which was listed on the London Stock Exchange until it was acquired by a consortium led by BC Partners and Pollen Stre ...
and
OakNorth Bank OakNorth Bank is a British bank for scaling businesses (typically with between £1m–£100m in turnover) that provides loans and both business and personal savings accounts. The bank, which gained regulatory approval in early 2015, was founded b ...
in the UK.


Political commentary

Small Business & Family Enterprise Ombudsman
Kate Carnell Anne Katherine Carnell (née Knowlman; born 30 May 1955) is an Australian businesswoman and former Liberal Party politician, who served as the third Chief Minister of the Australian Capital Territory (ACT) from 1995 to 2000. Early life and ...
says Judo Bank's launch is well-timed with the lending shortfall continuing to grow. "There is no competition", Carnell said. "The big four banks have 80 percent plus of the SME lending market and they mostly don't lend except if it is secured against property and that means access to capital is very difficult for many SMEs." Australian Prime Minister,
Scott Morrison Scott John Morrison (born 13 May 1968) is an Australian former politician who served as the 30th prime minister of Australia from 2018 to 2022. He held office as leader of the Liberal Party of Australia, leader of the Liberal Party and was ...
gave a virtual speech at the Singapore FinTech Festival on 8 December 2020, speaking about fintechs' positive impact on the economic recovery, referring to Judo and four Australian fintechs in particular. "I am incredibly proud of what our Aussie start-ups and early age ventures are achieving, as well as our well-established unicorns and what they’re achieving. You know some of them: Atlassian, Airwallex, Afterpay, Judo Bank, Athena Home Loans."


See also

*
Banking in Australia Banking in Australia is dominated by four major banks: Commonwealth Bank, Westpac, Australia & New Zealand Banking Group and National Australia Bank. There are several smaller banks with a presence throughout the country which includes Bendigo a ...
*
List of banks Lists of banks are contained in the following articles: By continent * List of banks in Africa – Each country in Africa has a list of banks operating in that country * List of banks in Asia – Each country in Asia has a list of banks oper ...
*
List of banks in Australia The following is the list of Banking in Australia, banks in Australia, as well as restricted Authorised deposit-taking institution, authorised deposit-taking institutions (ADI), credit unions, friendly society, friendly societies and subsidia ...
*
List of banks in Oceania This is a list of banks in Oceania Australia Central bank *Reserve Bank of Australia Major banks *Australia & New Zealand Banking Group, ANZ Bank **Suncorp Bank, Suncorp *Commonwealth Bank **Bankwest *Macquarie Group, Macquarie Bank *National ...


References

{{Banking Industry in Australia Banks of Australia Companies based in Melbourne Australian companies established in 2016 Banks established in 2016 Neobanks