Regional bank closure moratorium: A temporary reprieve or delaying the inevitable?

Critics have questioned Australia’s Big Four banks’ two-and-a-half-year moratorium on regional bank closures, calling it a move that simply delays the inevitable.

Earlier this week, the Australian Government struck a deal with the Commonwealth Bank of Australia (CBA), National Australia Bank (NAB), Westpac, and ANZ to keep regional banks open until July 2027. This follows the closure of more than 800 regional banks across the country since 2017.

“Moratoriums like this happen after every regional banking inquiry. It’s straight from the playbook,” said researcher Dale Webster, who has long campaigned against the big banks’ treatment of rural Australians.

“They will start up again in force as soon as it ends.

“The Riverina had 78 major banks in 1975. That number is now 25 banks, a loss representing a cut of 68 per cent of the Riverina bank network.”

Over the decade, the Riverina saw multiple branches shut in Junee, Temora, Gundagai, Griffith, and Berrigan.

A Senate inquiry into regional banks was held in Junee in 2023, and heard from local politicians and groups about the negative impacts the closures had on vulnerable communities.

In March 2023, Junee was set to become the 597th small town in Australia to be left with no bank before the Commonwealth Bank of Australia responded to the community backlash and agreed to continue part-time operations for at least the next three years.

“As of February 2025, 22 locations in the Riverina have lost their last or only bank, including one town that has lost all four of its big banks – Grenfell,” Ms Webster said.

The Senate inquiry report, released in 2024, found the current model of banking industry self-regulation had failed to shelter regional Australia from the damaging impacts of bank branch closures.

The Finance Sector Union also criticised the government’s moratorium agreement.

“It was disappointing, to say the least. Not only does this non-binding moratorium apply only to the Big Four banks, but it does nothing to protect regional banking services,” the Finance Sector Union said in a statement.

“The government’s announcement, which was merely tinkering around the edges of the agreements already in place with the Big Four, read as though the banks themselves wrote it.

“Banks may love it – but bank customers and us workers have every reason to be concerned.”

Member for Riverina Michael McCormack welcomed the deal between the government and the Big Four banks.

“This is an issue that is above politics — regional and rural communities simply need and deserve access to banking services; otherwise, they won’t be able to continue to prosper,” Mr McCormack said.

“Junee was set to join this list after suffering multiple bank branch closures in the last decade, as well as the Commonwealth Bank intending to close Junee’s last branch until significant community pushback and the Senate inquiry into Bank Closures in Regional Australia prompted a halt.

“The announcement comes about in no small part due to the persistence of the Junee community, who I have stood proudly alongside, in their efforts to keep their final bank branch open …

“I commit to continue working with the community to advocate for a long-term outcome that provides the surety we need.”

Junee Mayor Bob Callow also welcomed the moratorium and thanked the Junee community for its involvement in the Senate inquiry that caught the attention of politicians and banks.

“Additionally, to what we’ve been fighting for quite some time, I’m proud of the way Junee put up such a fight to keep the bank in the first place,” Cr Callow said.

“We will lose banks if this doesn’t happen, and hopefully, it’ll make the big banks rethink how they treat regional communities.”

Cr Callow was also pleased to share the Junee community’s positive engagement with the Commonwealth Bank.

“It’s a bit of you scratch my back, and I’ll scratch yours … we’ve got a good relationship with them now,” Cr Callow said.

“Hopefully, the town will be serviced by them for a lot longer to come.”

Cr Callow hopes the banks will reconsider the closures by the end of the moratorium period.

“If that’s not going to happen, hopefully, other solutions will come forward in that time, and people in small rural communities will at least have access to some sort of face-to-face banking services,” he said.

Cr Callow said communities must also work with and support their local banks to ensure their survival in rural areas.

“(Banks) just can’t afford to run every little bank everywhere,” he said.

“If the people don’t support them, then they’ve only got themselves to blame.”

As part of the moratorium, the banks have also accepted a new agreement with Australia Post to support Bank@Post services, which will allow banking access in areas without local bank branches.