Regional bank Heartland New Zealand has announced a simplification of its governance structure, a tier two capital issue and a planned capital return.The NZX-listed group announced on Friday it planned to merge into one board the currently separate Heartland New Zealand group board and Heartland Bank board.Previously the bank had to have its own board to comply with Reserve Bank of New Zealand rules. Heartland said in an NZX announcement the amalgamation would mean Heartland Seniors Finance (its Australian reverse mortgage business), Marac Insurance, and Heartland's stake in peer-to-peer personal lender Harmoney would be brought into the banking group. Heartland said it had also decided to go ahead with a tier two capital issue, which it flagged to investors in mid-August. It said the issue would raise up to NZ$75 million, including NZ$25 million of over-subscriptions, which would more closely align Heartland's capital structure with other banks. It said it had also decided to go ahead with a return of surplus capital to investors, given there remained uncertainty about its potential takeover of Dunedin-based car lending cooperative Motor Trade Finances.Heartland would seek shareholder approval at its next annual meeting on December 11 to return between NZ$58 million and NZ$100 million to investors through a pro-rata share purchase and cancellation.Fitch Ratings said the restructure, tier two capital issue and capital return were neutral for its BBB rating for Heartland, which had a stable outlook. However, the moves would weaken Heartland's capital levels, although not enough to affect its credit rating.