Newcastle Permanent chair discusses plan to join forces with Greater Bank
The merger of Newcastle Permanent and Greater Bank is progressing after member votes comfortably exceeded the threshold required for the customer-owned banks to join.
Incoming deputy chair of the new merged entity Jeff Eather (pictured above with Bernadette Inglis), says Newcastle Permanent regards brokers positively and has great relationships with them, which it sees as a positive going forward.
In March 2022, the board of directors of the two banks unanimously endorsed the proposal to merge, recommending their respective members vote in favour of the joining of the two mutuals. The proposal was submitted to APRA for review, culminating in a member vote, held on Wednesday, November 2.
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Special general meetings were held on Wednesday, and more than 17,000 members turned out to vote. Provisional results on Wednesday afternoon showed a high proportion were in favor of the merger.
In a joint statement released on Thursday morning, the banks confirmed member votes were well above the required 75% threshold for both brands to merge. Newcastle Permanent members also carried resolutions related to the merged entity’s name and constitutional amendments, they said.
The new merged entity, Newcastle Greater Mutual Group Limited, is to be led by a board including four directors from each of the current Greater Bank and Newcastle Permanent boards.
Greater Bank chair Wayne Russell (pictured immediately below) will assume the role of chair of the merged entity, and Newcastle Permanent CEO Bernadette Inglis will be group CEO.
Newcastle Permanent chair Jeff Eather will assume the role of deputy chair.
The merged organisation will feature more than $20bn in total assets and 600,000 customers, drawing from almost 200 years of combined operating history, the banks said.
Speaking to MPA on Wednesday evening, when provisional results following special general meetings indicated around 89% of voting members were in favour of the merger, Eather said he was very appreciative of members’ support.
“For us, it’s very important as we’re customer-owned, [and] we’re delighted with that result,” Eather said.
Eather said receiving the green light on the merger from members of the respective banks meant a great deal to him personally.
“We’ve sunk a lot of time and energy into working out strategically what will make our 120-year old organisation resilient and successful into the future and remain relevant to our customers,” Eather said.
Wednesday’s voting outcome marked the first phase of that journey. The two banks would now turn their focus towards a successful integration, he said.
“Doing that is a very proud achievement of the whole organisation, and as chair I share that great pride,” Eather said.
While waiting on APRA to provide final approval of the merger, Eather said the companies would start to discuss strategy. That will include the steps required to make day one of the combined organisation smooth for customers, providing tools to manage the two banks as one.
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Eather said the banks intended to retain the two separate brand lines, but regulations meant a multi-brand strategy had not yet been developed. Those discussions would now commence, including how Newcastle Permanent and Greater Bank would work with brokers, he said.
“Brokers are a vitally important part and a relationship that we cherish … they’re also an important part of the national mortgage lending landscape,” Eather said.
He said it was also too early to confirm how lending products under the two brands would progress, but confirmed the intention was to continue to operate the respective products under each bank.
“If we look at both brands side-by-side, some of the products that are targeted in terms of lending from both organisations are slightly different, the customer profile of both organisations is slightly different.”
However, Eather also noted the respective product lines already had a complementary nature.
“There’s a fair bit of complementary in our product range coming together now that is of great value in the fact that it is complementary, so we see that as an asset,” Eather said.
Speaking on what the merger means for brokers and their clients, Eather said for customers of Newcastle Permanent, the bank had taken steps to ensure its 120-year history would be maintained.
“For brokers and customers of Newcastle Permanent, what we’ve set about doing is making sure we’re still here for the next 120 years, that we remain relevant, and that the great quality products and services that we’re able to deliver to broker customers, is maintained or enhanced,” Eather said.
Russell said the member vote was an endorsement of the vision of both boards to bring the two organisations together.
“This is a landmark outcome for our respective organisations, customers and employees that will enable us to create a financial powerhouse based here in the Hunter,” Russell said.
Bringing the two brands under the one merged entity secures the future of mutual banking in regional NSW, he said.
“While we have big plans to grow and develop our business, we remain committed to keeping skills and expertise, jobs, and investment here in regional NSW. Starting with our commitment that our headquarters and customer contact centres will continue to be based in the Hunter, as they always have,” Russell said.
Inglis said the focus would now be on bringing the organisations together.
“We’re looking forward to bringing everyone together and to affirming our position as a significant regional employer of choice. Working for the merged entity will create opportunities for our people, enabling them to forge rewarding and diverse careers possible in a larger organisation,” Inglis said.
Following final regulatory approvals, the merger is planned to come into effect on March 1, 2023.
