Top executives and managers of listed Pyne Gould Corp - involved in establishing a New Zealand-owned "heartland" bank - have been rewarded with $1.8 million in shares, affecting both PGC and the heartland bank's holding company.
Craigs Investment partners broker Peter McIntyre said while there was "no doubt" a huge amount of work had gone into the merger already, it was "early days" for investors to be seeing rewards to management.
"While it is incentivising staff to stay and perform, investors may have preferred to see the business bedded in and with a few runs on the board before remuneration packages are handed out," he said.
PGC shares were up almost 3% and trading around 37c following the announcement.
The merger, completed this month, was announced in June last year between Canterbury Building Society, Southern Cross Building Society and Pyne Gould Corp's subsidiary Marac Finance - the heartland entity having assets of about $2.2 billion and about 70,000 customers.
Marac is taking a 71% stake in the company, with CBS and Southern Cross each taking a 14.5% stake.
Parent company Building Society Holdings Limited (BSHL) is expected to list on the stock exchange at the end of the month, then later seek a banking licence.
BSHL chairman Bruce Irvine, said the share plan rewards senior management for "their vision in creating a financial services group" to meet the financial needs of small to medium enterprises and individuals nationwide.
"It also provides an incentive for them to be part of its future development and growth," Mr Irvine said in a statement yesterday.
The scheme will have a $1.7 million impact on PGC's after-tax profit for 2011, while the remainder will cost BSHL $300,000 this year and $100,000 next financial year.
Half the shares will be immediately issued and those staff must stay with the company to receive the balance, which will be released from October, in three, three-monthly tranches.
Mr Irvine said under the plan a total of up to 4.4 million new shares will be issued at 36.74c, which is the equivalent of 0.5% of BSHL.
