Mutuals Newcastle Permanent and Greater Bank have made progress on their merger plans, with the two organisations endorsing the merger and recommending that their members vote in favour of the proposal.

The merger proposal will be submitted to APRA for review, before being put to members. No dates have been set for the meetings.

The two mutuals, both based in the Hunter region of New South Wales, announced in August last year that they had signed a memorandum of understanding. Yesterday they said they have completed their due diligence and both boards have unanimously endorsed the plan.

“Merging will enable us to keep pace with increasing regulation and reporting, and the rapid advancements in banking technology, both of which require significant investment,” Newcastle Permanent chair Wayne Russell said in a statement.

The combined assets of the two mutuals at June last year were A$19.8 billion (Newcastle Permanent $11.7 billion and Greater Bank $8.1 billion) and the combined customer base around 600,000.

Combined earnings in 2020/21 were $64.4 million (Newcastle Permanent $41.5 million and Greater Bank $22.9 million).

Part of the merger plan is to keep both brands. There will be no forced redundancies for at least two years and the combined branch network will be maintained for at least two years.

If the merger goes ahead, Greater Bank chair Wayne Russell will chair the new entity and Newcastle Permanent chair Jeff Eather will be deputy chair.

Newcastle Permanent chief executive Bernadette Inglis will be the CEO of the merged entity and Greater Bank CEO Scott Morgan will be deputy CEO.