Trustbanks to merge

Waimarino Bulletin, Volume 5, Issue 21, 28 October 1987, Page 1

Trustbanks to merge

Trust Bank Wanganui and Trust Bank Eastern and Central are to merge from April next year. The new bank will be known as Trust Bank Central and will have its administrative centre in Hastings. The merged banks, however, will retain their separate regional identities and will operate under their present names as divisions of the new bank, according to a press statement released yesterday. There will be no staff redundancies, says the statement. Trust Bank Central will operate on a regional basis from Wanganui, Palmerston North and Hastings. Each region will retain considerable autonomy, working within broad guidelines established by the parent company, Trustee Bank Holdings Limited, as is the case at present. Trust Bank Wanganui will have two members on the Trust Bank Central Board. Trust Bank Eastern and Central will have four. The ratio was determined by the relative size of the banks and their shareholding in Trustee Bank Holdings Limited. The Wanganui regional community trust will own shares in the parent company, as will the Eastern and Central Trust. The Trust Bank Central directors will be selected from the trustees of these trusts. A proportion of the profit will be returned to the region in the form of donations. This will continue the philosophy of supporting the communities which established the original trustee savings banks. The new bank will have assets of $400 million,

making it the second biggest in the Trust Bank group. In announcing the merger, Trust Bank Wanganui president, Mr M.A. Sewell, said that the merger was prompted by the deregulation of the New Zealand economy. "Banking is no exception in this process and we must prepare to meet increased competition in the marketplace", he said. "The depositors' funds of the combined banks exceed $400 million ensuring we have the strength and the firm base from which to take up the challenge and tackle the competition arising from the new deregulated banking environment," he said. Mr Sewell said "As well as providing a fully coinpetitive service the merger will in due course enable increased donations to community organisations. Trust Bank is the only bank which gives regular substantial financial support to the communities which it serves". Mr Sewell said there were other advantages, including increased career opportunities for staff and better and wider services for customers. "We believe that the merger which creates a larger bank recognises that we are a progressive region with a sound base for future market development," Mr Sewell said.