New 'heartland' bank expected to announce name today

Jeff Greenslade. Photo / Natalie Slade

A potential new Kiwi-owned bank is expected to announce its name today.

The financial services group is currently called Building Society Holdings (BSH) and is the result of a merger between Pyne Gould Corp's Marac Finance, CBS Canterbury and Southern Cross Building Society.

The company, which has made extensive use of the word "Heartland" in its promotional material, listed on the NZX on February 1 after receiving a BBB minus investment grade credit rating from Standard & Poor's. It is expected to apply for a banking licence around the middle of the year.

The company's focus is on small-to-medium sized businesses and farmers, providing business loans, residential mortgages and seasonal farm finance.

Since listing on February 1, BSH shares have traded in a 67c to 95c range. The stock closed yesterday at 70c, down one cent, and a discount to its net tangible asset value of 88c.

The listing marked the completion of a year-long project to bring together the three entities, which created a financial services group with assets worth about $2.2 billion.

BSH is expected to form part of the NZX-50 index once Pyne Gould Guinness has completed its in-specie distribution of its 72.2 per cent shareholding to shareholders. This is scheduled for the first half of 2011.

Chief executive Jeff Greenslade told the Herald in February that one of the key milestones for BSH had been getting an investment grade credit rating, which he said was vital for its application to become a bank.

He said then BSH would not be all things to all people "nor will we be heavily into residential mortgages".