Kiwibank seeks almost $100m to tap corporate sector

Wednesday 26th May 2010

Kiwibank needs south of $100 million to tap the corporate sector as it continues on its path of expansion and seeks to win customers from its Australian-owned rivals.

Outgoing chief executive Sam Knowles told a media conference in Wellington the bank needs “less than $100 million” as it looks to expand its business, particularly in the corporate space. Earlier this week, Prime Minister John Key said the bank had asked for more cash, and raised a potential partial float to “mum and dad investors” as an option for raising the funds. In March, the bank raised $150 million through a preference share issue on the NZX.

“A lot of business people continually approach us, and we’ve got the view that would be sensible for us to continue that way,” Knowles told reporters.

Knowles talked down suggestions his departure had anything to do with the government’s musings on a partial float of the lender, saying he had been considering the move for one or two years.

Though Knowles and Kiwibank chairman Jim Bolger weren’t keen on discussing the government’s comments around potential part-privatisation, Knowles said the main issue for Finance Minister Bill English was whether the lender paid dividends to the government or not. The government said it won’t pursue asset sales without an electoral mandate from the public.

Bolger flagged the agriculture sector as an area for the bank to tap, saying a “significant” person in the industry had contacted him asking whether Kiwibank would loosen its lending requirements to the rural sector.

The outgoing chairman also reaffirmed expectations that former Finance Minister Michael Cullen will replace him as chairman of New Zealand Post and Kiwibank when his tenure ends in October.

Businesswire.co.nz

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