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Sovereign Housing Group this week joined with Wessex Housing Partnership to form a new 30,000-home housing association.

It is the first ‘amalgamation’ since the Tenant Services Authority and Homes and Communities Agency were set up at the end of last year.

Mergers and amalgamations have become increasingly difficult for the sector since the banking crisis.

Landlords have found that they are unable to secure consent from their lenders unless they agree to reprice their loan facilities.

Andrew Cowan, a partner at law firm Devonshires, said: ‘It’s amazing [Sovereign and Wessex] got consent.

‘It’s difficult to get consent from lenders in this climate. The banking market has changed.’

He added: ‘Amalgamations are becoming increasingly used. There’s a recognition that it’s becoming the standard for group mergers.’

In a traditional merger one of the associations ceases to exist, meaning it is likely to have to pay out to people in its pension scheme, explained Emma Tarran, a partner at law firm Trowers & Hamlin.

In an amalgamation both associations remain as separate legal entities, she added.

A spokesperson for Sovereign said the bodies were amalgamating rather than merging in order that ‘the strengths of both Sovereign and Wessex are being combined to form the new Sovereign Group’.

Wessex will now be known as Kingfisher HVHS Housing Association.