Heartland NZ says process towards formal bank registration application of 'indeterminate length'; It can't comment further

Heartland New Zealand has given little away in its quest to become a bank as the building society reported its half-year financial results.

Heartland, formed in January last year through the merger of Marac Finance, CBS Canterbury and Southern Cross Building Society, reiterated that it has engaged with the Reserve Bank regarding its application for bank registration.

"The making of any formal application is subject to Heartland being satisfied that it has met all requirements of the Reserve Bank," Heartland said.

"The process through to formal application is of indeterminate length. As discussions with the Reserve Bank are confidential, Heartland is not able to comment further as to timing or criteria."

Heartland CEO Jeff Greenslade told interest.co.nz in late 2010 that Heartland would only formally apply for bank registration when it was confident its application would succeed.

And the independent report on the merits of the ultimately successful merger to create Heartland, by Cameron Partners and Northington Partners, suggested it could take up to two years to obtain banking registration, although there was a risk it could take even longer. The two firms did, however, suggest it was likely bank registration would ultimately be granted.

The Reserve Bank itself says the length of time it takes to process bank licence applications will vary, and the time taken with any specific application will depend on the complexity of the application. It also notes that unsuccessful applicants can reapply. See more on the process of applying to become a bank here.

Last October the Reserve Bank granted PSIS, now the Co-operative Bank, bank registration.

Meanwhile, Heartland reported net profit after tax of NZ$9.76 million for the six months to December 31, 2011 near the top of the NZ$9 million to NZ$10 million range it flagged in November. See Heartland's half-year financial statements here.