NZ-owned bank planned for 'heartland

Plans have been announced for a new high street Kiwi-owned bank to work in the "heartland" of New Zealand.

Three organisations behind the plan say they hope to serve individuals and small businesses wanting an alternative to the big banks.

It would be set up through merging the banking assets of Pyne Gould Corporation, Southern Cross Building Society and Canterbury Building Society.

The bank, which has yet to be given a name, would have the "scale and resources to work with customers in Heartland New Zealand", a statement said. "We see a significant opportunity in entering the banking market as it is clear to us that New Zealanders and New Zealand businesses are seeking an alternative to the incumbent banks in the markets we intend targeting."

The three parties signed a memorandum of understanding yesterday in a step towards forming the bank.

The new bank would be the fourth New Zealand-owned bank after Kiwibank, SBS Bank and TSB Bank.

It would have $2.2 billion in assets and be the only New Zealand-owned bank on the local stock exchange.

It was hoped an implementation agreement would be in place within the next few months and, if all approvals were granted, it was expected the merged entity would start trading by early next year.

- additional reporting NZPA.