Hastings Building Society boss joins SBS Bank board after finding 'pot of gold at the end of the rainbow'

Frank Spencer, ex-chairman of the Hastings Building Society (HBS), has been appointed to the SBS Bank board after the Southland-based bank's takeover of HBS.

Spencer is also the managing director of valuation, property and infrastructure consultancy Crighton Stone Limited. He became an HBS director in 2001 and chairman from 2008 until the takeover by SBS Bank was completed on October 1 this year.

“Seeing HBS become part of a registered bank was the ultimate goal, which because of the small size of the Hawke’s Bay institution, was only available through a merger," Spencer said.

The transition to become ‘HBS Bank’ was "the pot of gold at the end of the rainbow."

Spencer's appointment to the SBS Bank board fulfills part of the merger arrangements agreed between it and HBS. The deal called for an HBS representative, pending Reserve Bank approval,  to be appointed to SBS Bank’s board, although Spencer will face re-election at next year’s annual meeting.

The deal has seen HBS members become members of SBS Bank, which as well as having a banking licence from the Reserve Bank, is also still a mutually owned building society.

The deal called for HBS's total assets of about NZ$185 million, equivalent to about 10% of SBS Bank's NZ$2.6 billion, to be merged into SBS Bank.

Spencer told interest.co.nz in August that new Reserve Bank regulations for non-bank deposit takers due for introduction in December and the aggressive targeting of retail deposit money by the major banks striving to meet recently introduced Reserve Bank funding requirements, meant costs were rising and times were getting tougher for small financial institutions.

HBS members endorsed the SBS Bank deal at a special meeting on August 31 voting 98% in favour of it.

The merger agreement sets out that all staff and management in HBS’s Hastings and Napier offices will be retained with the HBS brand also remaining. There’s also a guarantee for community contributions to rise from about NZ$60,000 last year to at least NZ$100,000 per annum over the next five years.

SBS Bank chairman Acton Smith said Spencer was an "extremely knowledgeable businessman" who had been a key player in promoting contemporary governance disciplines, director training and independent recruitment assistance at HBS.

"He brings many areas of skills and expertise to the SBS Bank board, including independent assessment, investment analysis, property markets and a thorough knowledge of the Hawke’s Bay region and its economy," said Smith.