Beyond Bank CEO Jake Bromwich
The board of P&N Bank have elected not to proceed with a proposed merger with Beyond Bank Australia.
Police & Nurses Limited “has concluded its due diligence on the potential merger with Beyond Bank announced in June 2024 and has decided not to proceed” P&N announced in a bombshell statement to members yesterday morning.
The PNL Board determined that “progressing the merger would not be in the best interests of its members.”
PNL’s chair Gary Humphreys said “the board had hoped that a merger recommendation would result from the due diligence process.
“While it’s disappointing that we will not be progressing this opportunity, our due diligence process was robust and I am confident that we have made the right decision,” Humphreys said.
Beyond Bank, by contrast, shared no context or explanation in their own statement to members.
Beyond simply announced that “a potential merger between it and Police & Nurses will not proceed.
“Beyond Bank is bound by confidentiality obligations in the Memorandum of Understanding and there will be no further comment.”
This leaves the rumour mill to run riot and there seems to be one primary theory as to what may really be going on.
The first is that the due diligence uncovered uncomfortable facts, from the P&N view, regarding Beyond Bank.
Some of these, at least, are in the public domain. The Australian Financial Review over the last couple of months has reported extensively on regulatory and criminal investigations into the Westpac-owned RAMS Home Loans.
Beyond announced the appointment of Jake Bromwich – the former (and final) CEO of RAMS – in September last year.
On Friday the AFR, in its latest instalment on the RAMS saga, reported that Westpac stood down Jake Bromwich as RAMS boss before he took the Beyond job.
Thus there are questions over the thoroughness of the disclosures by Bromwich to the Beyond board last year, and now the completeness and timeliness of Beyond’s disclosures to Police & Nurses.
The fact the P&N announcement that it was walking away from the merger was made only one business day after Friday’s latest AFR article suggests it may be the latter.
Bromwich was to have served as CEO of the combined bank had the merger proceeded, with P&N CEO Andrew Hadley keen to move back to the east coast after 12 years at the helm.
Banking Day requested interviews with both CEOs yesterday but did not hear back rom P&N and Beyond declined.
An alternative theory is that P&N Bank’s board was being seduced by a rival and more compelling merger proposal from any of the largest mutual banks.
Offer of this type will now overwhelm P&N, even if there was no competing merger proposal before the weekend.
P&N confirmed it “will continue to pursue our strategic agenda to grow organically and through mergers while always acting in the best interests of our members.”
Beyond Bank is sidelined in the merger stakes until Beyond’s members are more fully informed on the credentials and history of its CEO.