Australia-based lender ANZ has announced the successful acquisition of Suncorp ’s banking business, two years after first declaring its plans. As per the information detailed in the press release, the completion of the sale represents a substantial strategic milestone for Suncorp, allowing it to centre its efforts on optimising its insurance capabilities for its customers and providing increased value to shareholders.

In addition, Suncorp’s officials mentioned that they maintained the bank’s capabilities, selling it to ANZ in overall performance and risk maturity. When it comes to ANZ, the bank’s current move supports and solidifies its presence in Queensland, adding scale to its retail and commercial businesses. This is set to enable ANZ to better compete in the Australian market, whilst improving its solutions. On the other hand, by selling its banking arm, Suncorp is set to focus on delivering on the commitments agreed with the Queensland government, including investment in a disaster response centre of excellence and establishing a regional hub in Townsville aiming to employ approximately 120 individuals.

Also, according to Suncorp’s representatives, the company expects the net proceeds from the sale to reach nearly USD 4.1 billion, intending to return the majority to shareholders, mostly by way of a capital return and a smaller dividend component. The group projects that this move is set to happen in the first quarter of the 2025 calendar year, with the timing being determined on the receipt of a ruling from the Australian Tax Office and approval from the Australian Prudential Regulation Authority. Moreover, the transaction has already received approval from the Australian Competition Tribunal and the Federal Treasurer under the Financial Sector Act. Additionally, part of the transitionary business and technology services are set to be exited within two years, while the remainder exited no later than five years post-completion.

Recent news regarding the acquisition Despite now successfully completing the sale, ANZ and Suncorp encountered several difficulties since first announcing their plans in July 2022. For example, most recently, the Australian Competition and Consumer Commission (ACCC) underlined its concern that a tie-up between the two financial firms would negatively impact competition, as four lenders had three-quarters of the country’s USD 1.2 trillion. In addition, the competition regulator highlighted that the acquisition would increase the probability that the major banks adopt a ‘live and let live’ approach to each other instead of competing on price, innovation, and the quality of their services.

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