ANZ Acquires Suncorp Bank
(18 July 2022 – Australia) Suncorp has signed an agreement to sell its banking division to ANZ for A$4.9 billion.
The sale includes the Queensland based lenders A$47 billion of home loans, A$45 billion of deposits and A$11 billion in commercial loans, elevating ANZ to the third largest banking operation behind CBA and Westpac, ahead of NAB and Macquarie.
The transaction, which is awaiting regulatory approval from the Federal Treasurer Jim Chalmers and the Australian Competition and Consumer Commission (ACCC), includes a cash sale of Suncorp Bank to ANZ for A$4.9 billion (A$1.3 billion of goodwill paid above net tangible assets). According to Bloomberg, ANZ will raise A$3.5 billion at a 12.7 percent discount for the Suncorp deal after the QLD based lender announced last month it was planning to sell its banking operations to refocus on insurance.
It remains to be seen if ANZ will continue to pursue its mooted acquisition of MYOB from KKR to expand SME finance integration with acquisition plans still ongoing according to a statement – “ANZ and KKR are yet to reach agreement in relation to the acquisition and there is no certainty it will proceed”
Suncorp will continue to operate under the Suncorp Bank brand with ANZ reporting that it intends to operate it as a separate business until 2025.
“As a dedicated insurance business we will be singularly focused on meeting the needs of our customers and communities at a time when the value of insurance has never been greater” commented Suncorp Group CEO Steve Johnson.
“We acknowledge the needs of insurance customers are rapidly changing, with a preference for digital interactions and for product design to take into account personal circumstances and risk profiles. At the same time, the external environment has seen more frequent and severe natural hazard events resulting in increased costs and affordability challenges. Suncorp will continue to be at the forefront of advocating for a more resilient Australia and for all levels of Government to focus on mitigating the impacts of major weather events through improved public infrastructure, subsidies to improve private dwellings and an overhaul of planning laws” Johnson added.
“The acquisition of Suncorp Bank will be a cornerstone investment for ANZ and a vote of confidence in the future of Queensland. With much of the work to simplify and strengthen the bank completed, and our digital transformation well-progressed, we are now in a position to invest in and reshape our Australian business. This will result in a stronger more balanced bank for customers and shareholders” stated ANZ CEO Shayne Elliott.
“We have admired the transformation that has occurred under the leadership of Steve Johnston and Clive van Horen and believe Suncorp Bank is a natural fit with ANZ given its culture, risk appetite and customer focus. ANZ has licenced the Suncorp Bank brand for five to seven years and we are committed to maintaining its current branch footprint in Queensland for at least three years post completion.”
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