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Summerland Bank and Regional Australia Bank are now recommending the merger to members and are readying to submit documentation to APRA.
The proposed merger date of 1 July 2026 has also been set.
Members and employees will be kept informed throughout the process, with each lender hoping for a “smooth and positive transition.”
According to Summerland Bank CEO John Williams, it’s “business as usual” until the member vote takes place.
Some of the commitments the mutual has made to its stakeholders are no forced staff redundancies and no branch closures.
Each brand will also operate independently and keep its respective name. Following the merger, the mutuals will “look to review the integration of technology, services and products, including our business name which we expect to complete within 18 months.”
According to Williams, the transition will allow for a “more robust future” and include benefits such as:
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Enhanced customer experience: A broader range of products and services, accessible through a large network of branches and digital channels.
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Community investment: Increased capacity to support local projects, charities, and sustainability initiatives that align with local and regional values.
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Financial opportunity: Greater financial size and strength allow for more opportunities to invest in and support member safety programs, innovative product solutions, and local businesses.
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Employee opportunities: More diverse roles, training pathways, and career development for employees, underpinned by a collectively strong and supportive workplace culture.
Regional Australia Bank’s board approved the merger on 15 April and Summerland on 14 April.
David Heine, CEO of Regional Australia Bank, said: “This is a proud step forward for both Regional Australia Bank and Summerland Bank. The successful completion of the due diligence phase and Board approvals highlights the strength of our alignment, values and shared ambition for our proposed merger.
“This partnership represents a meaningful milestone in our ambition to be chosen by more regional Australians to be their bank. Together we can accelerate our work to deliver a more vital regional Australia through finding the good that money can do.”
Summerland Bank and Regional Australia Bank announced intention to merge in October 2024, signing a memorandum of understanding.
Founded in 1964, Summerland Bank is based out of the Northern Rivers region of NSW and employs over 120 individuals from the local community across its Lismore headquarters.
Regional Australia Bank operates across 37 branches in regional NSW, including the New England North West, Central West, Mid North Coast, and Greater Newcastle regions.
“This partnership would not only allow us to combine our resources but also broaden our reach, and provide more branches and improved services within regional communities,” Williams said to Broker Daily following the initial announcement.
“Our customers will also benefit from the combined expertise of two customer-owned, community-focused banks with deep regional roots. Together, we aim to deliver more personalised in-branch banking experiences alongside advanced digital services, all tailored to meet the specific needs of regional Australians.”
The customer base of the lenders is expected to grow to over 130,000, with around 49 branches and combined assets of $4.8 billion if the merger takes place.
APRA has been vocal on the matter
The regulatory body has made it clear that mutuals should look to merge amid increased risk.
Therese McCarthy Hockey, executive board member of APRA, said on 14 March that mutuals must look to merge if they’re to remain competitive.
“For the mutuals, our observation is that some boards lack the necessary skills to guide their banks in a modern banking environment, in particular technology skills. That may require you to upskill existing directors, but you might also need to look beyond your bank’s traditional geographic or industry-based pool to seek fresh talent,” McCarthy Hockey said.
With Qudos Bank and Bank Australia recently setting a date for merging, it appears mutuals are listening.
[Related: Mutuals announce merger intentions – what’s in store for consumers?]
