Greater Bank CEO Scott Morgan (L) and Newcastle Permanent CEO Bernadette Inglis
Newcastle Permanent Building Society and Greater Bank members have voted in favour of the proposed merger of the two mutuals.
Both organisations held extraordinary general meetings yesterday. They issued a joint statement saying the vote was “strongly in favour” of the merger (the numbers were not released).
The merged organisation, to be called Newcastle Greater Mutual Group Ltd, will have around 600,000 members and more than A$20 billion of assets. The merger is planned to take effect on 1 March next year.
Both brands will be retained and there will be no change to customer accounts or banking details. The parties have committed to maintain branch numbers for two years and avoid any forced redundancies for two years.
Newcastle Permanent chief executive Bernadette Inglis will be the group CEO.
The board will be made up of four directors from each organisation. Greater Bank chair Wayne Russell will be group chair.
Newcastle Permanent chair Jeff Eather said the merger of the two Newcastle-based mutuals will form a solid base for involvement in the ongoing consolidation of the sector.
Eather said: “We need to keep growing to cover an increasing regulatory and tech cost base. Ongoing investment in technology and compliance is the new normal. The way we look at it, it is good for customers.
“By coming together with Greater Bank we will spend that capital once, not twice, and we will have more capital for growth opportunities.”
He said the merged group was committed to remaining a mutual.
With $20 billion of assets Newcastle Greater Mutual Group will be bigger than Great Southern Bank, which is currently the biggest mutual bank.
However, when Heritage Bank and People’s Choice Credit Union complete their merger the merged entity will be about the same size as Newcastle Greater.
Eather said the parties will now go back to APRA to get sign-off for their merger implementation plans.