S Bank and Tapiola Bank merge as part of a wider cooperation agreement
S Bank and Tapiola Bank merge to form a new S Bank. S Group owns 75 per cent and the LocalTapiola Group 25 per cent of the new bank, which will start operations in 2014.
S Group and LocalTapiola have simultaneously concluded a Letter of Intent regarding the relaunch of bonus partnership after an intermission of a few years. The intention is to start bonus cooperation as regards insurance in the beginning of June 2014.
In addition, the parties have concluded a Letter of Intent concerning the deepening of S Group and LocalTapiola strategic cooperation. New forms of the cooperation will be explored during the autumn.
With the banks' merger, offering to the customer-owners of the retail co-operatives will extend to secured loans. Correspondingly, the customers of LocalTapiola will get an option of more versatile banking services within a service network that is significantly more extensive than the current one.
— The balance sheets of the merging banks complement each other very well and together, the banks form a larger entity, which has better operational preconditions than separate service providers, emphasises SOK's Chief Executive Officer, Kuisma Niemelä.
Despite its increased resources, the new S Bank intends to pursue controlled, moderate and profitable growth as regards housing loans and other secured credit granting. In contrast, stronger growth is the target in basic banking services, consumer credit, mutual fund operations and asset management.
As part of the merger of the banks, LocalTapiola Asset Management's asset management operations and mutual fund operations will diverge. Mutual fund operations will be transferred to S Bank's future subsidiary, FIM Asset Management Ltd, forming Finland's fourth largest mutual fund company. LocalTapiola's asset management company will continue under the 100 % ownership of LocalTapiola, and no changes will occur in the position of its asset management customers or the services offered to them. LocalTapiola Asset Management will be responsible for the portfolio management of mutual funds carrying the LocalTapiola name also after the merger.
— The new S Bank and the cooperation between S Group and LocalTapiola will create and strengthen the operational preconditions of our regional companies. The cooperation of two customer-owned and regionally strong groups will create new kinds of added value to the customers in both services and benefits, says President of Local Tapiola Group, Erkki Moisander.
The merger of the banks into a new S Bank still requires Financial Supervisory Authority's, as well as Competition Authority's and Consumer Agency's permissions. In addition, the new bank must apply for a banking licence of its own.
Additional information after 1:15 pm
SOK, Jari Annala, Director, CFO, Chairman of S Bank's Board of Directors, tel. +358 10 76 82040 (banking and asset management)SOK, Director Harri Miettinen, tel. +358 10 76 80230 (bonus cooperation and strategic cooperation)LocalTapiola, Erkki Moisander, President, tel. +358 20 522 2478 (bonus cooperation and strategic cooperation)LocalTapiola, Harri Lauslahti, Group Director, tel. +358 9 453 7100 (banking and asset management)