“The acquisition is a critical step in Heartland’s strategy for expansion in the Australian market and achieving its long-term growth ambitions,” Heartland said.
Heartland is already well-established in Australia through Heartland Australia.
In 2023, together, Heartland’s Australian reverse mortgage and livestock finance businesses had approximately $2 billion of gross finance receivables.
Heartland signed a conditional deal in October 2022 for the purchase of Challenger - a long-established authorised deposit-taking institution, which offers customers a range of savings and lending products in Australia.
Subject to completion, Heartland’s existing reverse mortgage and livestock finance businesses in Australia will be transferred to sit under Challenger Bank, and the bank will be rebranded to Heartland Bank Australia, the company said.
The acquisition of Challenger Bank was strategic for Heartland, providing immediate access to lower cost deposits in Australia to complement existing and successful wholesale funding capability.
Heartland said the board expects to target a total dividend payout ratio in the financial year ending June 30, of 50 per cent of underlying net profit after tax.
Greenslade saw through the formation of Heartland in 2011, and the receipt of Heartland Bank’s RBNZ banking registration in 2012.
“Post-completion, Jeff’s focus as CEO will be on the strategic transition of Heartland in its role as a listed parent company of banks in two jurisdictions, the integration of Challenger Bank into the group, and the continued development of Heartland’s business in Australia,” the company said.