(Australia) – Australia’s Westpac Banking Corp has closed a A$900 million purchase of BT Financial Group from US based Principal Financial Group, adding to its existing capabilities in local funds management.The Bank is acquiring most of Principal’s Australian wealth management business, creating Australia’s fourth biggest retail fund manager with more than A$30 billion under management in the process.
Westpac, Australia’s fourth largest bank, is planning to remove around 10 percent of BT’s 200 wealth management jobs (around 200 positions) over the next two years in chasing annual cost savings of A$65 million come the end of 2004.
The transaction is the 3rd funds management acquisition this year for Westpac, following on the heals of its A$323 purchase of Rothschild’s Australian asset management unit in June and its A$36 million purchase of Hastings Funds Management a few days ago.
BT’s attractive wrap accounts platform with A$6.5 billion under administration, its distribution arm, margin lending business and part of its investment management capability are all included in the Westpac acquisition, with the combined Westpac-BT operation now having around a million customers, 15,000 external financial advisers and 700 internal financial advisers and planners.
The deal also includes BT’s corporate superannuation and fund management businesses in New Zealand.