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Mutual bank, credit union to merge

By Sarah Kendell
2 minute read

A mutual bank has announced it’s entered into an agreement with a rival credit union to explore merger opportunities.

In a statement, Heritage Bank said it had entered into a non-binding agreement with Adelaide-based People’s Choice Credit Union to assess the benefits to members of a merger.

“If a merger were to proceed, both organisations’ members would benefit from being part of one of Australia’s largest customer-owned banking organisations with approximately 700,000 members and $22 billion in total assets,” the two groups said.

“The proposed merger has a strong strategic rationale given the complementary capabilities and geographic footprint of both parties. By joining forces, the merged entity would be of a size and scale that would enable both organisations to deliver more for their members through enhanced products, services, digital capabilities and competitive pricing.”

The two firms said they had committed to no branch closures or non-executive redundancies as a result of the merger going ahead. Both groups would have equal board representation and head offices would be maintained in Queensland and South Australia.

“Heritage and People’s Choice have been in discussions for several months. We recognise that we are both strong businesses, with approximately the same number of members, employees and assets so if a merger proceeds it would be a true merger of equals,” People’s Choice chairman Michael Cameron said.

“While we are both successful organisations, joining forces would provide us with the scale, profile and nationwide presence to redefine mutual banking for current and future members,” Heritage Bank chief executive Peter Lock said.

The two groups said a “detailed and thorough due diligence process” was underway around the proposal and members would vote in early 2022 if it went ahead.