Heartland Bank

Heartland Bank Limited

Type	cooperative
Traded as	NZX: HBL
Industry	Financial Services
Founded	5 January 2011 (2011-01-05)
Headquarters	Auckland, New Zealand
Area served	New Zealand
Products	banking insurance financial services property
Total assets	$2.34 billion
Number of employees	more than 350 (2012)[1]
Website	www.heartland.co.nz

Heartland Bank (formerly Heartland Building Society) is a New Zealand-based bank that was created in 2011 through the merger of four financial organisations to obtain national coverage and obtained its banking licence in 2012.^[2][3][4][5] It provides retail banking services, lending, livestock and seasonal financing, home and vehicle loans and insurance services, and has a strong focus on the rural farming sector.

Heartland Building Society became a registered bank on 17 December 2012 but its component parts had a long history in New Zealand with roots stretching back to 1875.

History

Predecessors

In 1875, the Ashburton Permanent Building & Investment Society was established, which subsequently merged with SMC Building Society and Loan & Building Society.^[6] Together they became CBS Canterbury.

Separately Southern Cross Building Society opened in Auckland in 1923, it offered a similar range of financial services to its customers throughout the North Island.

In 1952, MARAC finance was established lending money to business to purchase commercial vehicles as the North Shore Rental Van Company. Over the next 55 years it grew to provide financing, lending and insurance services to businesses and individuals.

Leading stock and station companies, Williams & Kettle, Wrightson, Pyne Gould Guinness, and Reid Farmers which became PGG Wrightson established PGG Wrightson Finance (PWF) in the 1940s. PWF provided financial services to its farming and rural clients.

In late 2010 a plan was hatched to bring together these four separate financial institutions to create a financial company with national coverage across New Zealand that had enough assets to become a bank. On 5 January 2011, CBS Canterbury, Southern Cross Building Society and MARAC Finance Limited combined to become one organisation and on 31 August 2011, the Group acquired PGG Wrightson Finance.

Becoming a bank

Heartland was created from the merger of CBS Canterbury (Canterbury Building Society), Southern Cross, MARAC and PGG Wrightson Finance.^[7] The rationale for the merger was to create financial institution that had national coverage and enough assets and resources to get a full banking licence.

On 12 December 2012, the Reserve Bank of New Zealand announced that Heartland Building Society has been registered as a bank and the organisation changed its name to Heartland Bank. In May 2013 ratings agency, Standard & Poor's^[8] placed Heartland Bank, together with seven other small New Zealand financial institutions on a credit rating downgrade watch, citing potential risks from overexposure to New Zealand's highly inflated housing market. In October 2014, Heartland's rating was raised to BBB (outlook stable) in October 2014. ^[9] In October 2015, Fitch, another credit ratings agency confirmed Heartland with a rating of BBB (Outlook stable), noting "core asset quality to remain sound, benefiting from continued improvement in underwriting standards and good economic conditions".^[10]

Branches

Heartland Bank's Head Office is located in the Auckland suburb of Newmarket and the bank has over 15 branches located throughout New Zealand.

New markets

In February 2014, Heartland has moved into the Reverse Mortgage (or Home Equity Release) market, offering home owners (usually retired people) the ability to borrow against the equity in their home without interest payments charged up front.^[11] In September 2014, it moved into the peer-to-peer lending sector through its 10% shareholding in Harmoney Limited.^[12]

References

External links

• Official website

Building societies of New Zealand
Canterbury Building Society General Equity Building Society Hastings Building Society Heartland Building Society Heretaunga Building Society International Building & Investment Society Kiwi Deposit Building Society Loan And Building Society Manawatu Permanent Building Society Manchester Unity Building Society Nelson Building Society Safe And Sound Building Society Southern Cross Building Society Southland Building Society The Napier Building Society (Permanent) Wairarapa Building Society