Only 5 per cent of new retail deposits and about 22 per cent of reinvestments during August required the sole benefit of the Crown guarantee.
There was acceptance by depositors of what Heartland was trying to achieve, Stephen said.
"Depositors know we are New Zealand-owned and New Zealand-controlled," he said. "They know that if we are raising money locally, we are looking to invest locally.
"There is an affinity with that and it is reflected in the loyalty of depositors."
Depositors were confident management could deliver on what it said it could do, he said.
Stephen planned to provide monthly updates to depositors.
Forsyth Barr broker Peter Young said Heartland would be very happy with a reinvestment rate of 74 per cent.
"This demonstrates that investors view the company to be very sound and are quite happy reinvesting their funds with them.
"Given they haven't yet got a banking licence, it proves [chief executive] Jeff Greenslade and his management team are doing a good job."
With the Government guarantee expiring soon, investors needed to start looking for secure places to invest their funds. Heartland was providing a secure place for investors if it met their investment criteria.
"Sooner or later the financial markets were going to have to live without the security of the guarantee in place," Young said.
Stephen said Heartland had tried to lift the amount of information made available to the market.
Heartland made sure it kept in direct contact with investors as well as advising the market.
The structural pillars were in place and he said Heartland had a strong balance sheet and surplus equity.
"We are well positioned and depositors recognise that," Stephen said.
Greenslade said Heartland share purchase plan had closed, raising $12.4 million with 1090 shareholders participating.
The result was ahead of expectations.
Before the planned placements to Pyne Gould Corporation and PGG Wrightson, the share purchase plan was designed to ensure fairness and equity to all shareholders.
The total capital committed to the share purchase plan and placements was $58 million at an average issue price of 65c. Shares were trading yesterday at 56c.
The completion of the acquisition of PGG Wrightson Finance was expected to proceed today, Greenslade said.
Impact Capital, Pyne Gould Corp and ACC would become the three largest institutional shareholders in Heartland.
Impact was a long-term value investor and PGG Wrightson would also become a significant shareholder in Heartland.
- Otago Daily Times
