As part of an extension to its core business, super fund-backed Members Equity Bank (ME Bank) has launched a new product that allows employees to salary package new and demonstrator vehicles.

Known as a novated lease agreement, vehicle costs are deducted from the employee's salary package, which covers the lease repayment, fuel, vehicle registration, full comprehensive insurance, servicing, repairs and tyres.

ME Bank has teamed up with Leasexpress Fleet Management to offer the product.

"Leasing is already part of our core business . we've got a fair bit of expertise at leasing, and we thought novated leasing would be a good addition," ME Bank business banking marketing manager Luke Easton said.

"Also, it's not home loans so there are not as many competitors out there."

Easton said the product was needed and it was a "great fit" for the bank's core constituency of more than 200,000 home loan customers and industry fund stakeholders.

The product is aimed at superannuation fund employers and employees and so far around 80 deals have been signed.

"We're only just starting to promote it, so it's more just been through word of mouth at this stage. But we're looking to promote it more in 2010," Easton said.

Meanwhile, ME Bank is on the hunt for a new chief executive after the restructure of Industry Super Holdings (ISH) to form three distinct business units.

ISH is the holding company for IFS, ME Bank and Industry Funds Management.