Heartland Bank is a New Zealand owned bank that was created in 2011 through the merging of four financial organisations to gain.Heartland was granted its bank registration by the Reserve Bank of New Zealand in 2012. It specialises in motor vehicle loans, reverse mortgages, small business finance, livestock finance, savings, investments and deposits. Heartland became a registered bank on in 2012 but its predecessors have had a long history in New Zealand with roots stretching back to 1875.
History
Predecessors
In 1875, the Ashburton Permanent Building & Investment Society was established, which subsequently merged with SMC Building Society and Loan & Building Society. Together they became CBS Canterbury. Separately Southern Cross Building Society opened in Auckland in 1923, it offered a similar range of financial services to its customers throughout the North Island. In 1952, MARAC finance was established lending money to business to purchase commercial vehicles as the North Shore Rental Van Company. Over the next 55 years it grew to provide financing, lending and insurance services to businesses and individuals. Leading stock and station businesses, Williams & Kettle, Wrightson, Pyne Gould Guinness, and Reid Farmers which became PGG Wrightson established PGG Wrightson Finance in the 1940s. PWF provided financial services to its farming and rural clients. In late 2010 a plan was hatched to bring together these four separate financial institutions to create a financial company with national coverage across New Zealand that had enough assets to become a bank. On 5 January 2011, CBS Canterbury, Southern Cross Building Society and MARAC Finance Limited combined to become one organisation and on 31 August 2011, the Group acquired PGG Wrightson Finance.
Becoming a bank
Heartland was created from the merger of CBS Canterbury, Southern Cross, MARAC and PGG Wrightson Finance. The rationale for the merger was to create financial institution that had national coverage and enough assets and resources to get a full banking licence. On 12 December 2012, the Reserve Bank of New Zealand announced that Heartland Building Society has been registered as a bank and the organisation changed its name to Heartland Bank.
Credit Rating
In May 2013 ratings agency, Standard & Poor's placed Heartland Bank, together with seven other small New Zealand financial institutions on a credit rating downgrade watch, citing potential risks from overexposure to New Zealand's highly inflated housing market. In October 2014, Heartland's rating was raised to BBB in October 2014. In October 2015, Fitch, another credit ratings agency confirmed Heartland with a rating of BBB, noting "core asset quality to remain sound, benefiting from continued improvement in underwriting standards and good economic conditions". In September 2018, Fitch affirmed Heartland's credit rating of BBB noting Heartland "has achieved a leading niche franchise and some price-setting power, which resulted in a strong net interest margin".
In April 2016, Heartland launched an online platform, Open for Business, offering unsecured loans for small businesses. An application through Open for Business can be completed in two to three minutes and the applicant receives an immediate decision.
Savings & Investments
In May 2018, Heartland's Direct Call Account received a 5-star rating from CANSTAR in its Flexible Saver and Regular Saver categories. In June 2018, Heartland launched a mobile app for its deposit customers to give them better control over their investments. In July 2018, Heartland was named Canstar Bank of the Year – Savings. Canstar researched, analysed and compared 31 accounts from 11 providers for the annual ratings.
