The Australian Competition Tribunal has overturned an Australian Competition & Consumer Commission (ACCC) decision in August 2023 to reject ANZ’s proposed A$4.9 billion ($3.2 billion) acquisition of Suncorp Bank from the Suncorp Group. Suncorp is Queensland's leading bank and the sixth largest bank in Australia, while ANZ is the fourth largest.
ANZ chief executive officer Shayne Elliott said in a February 20 media statement: “This is a significant milestone and an important step forward in the process, however we still have further conditions to meet. We remain committed to completing the acquisition as soon as possible once all sale conditions are met."
“Suncorp Bank is a high-quality business with a strong team and excellent customer base, and we look forward to bringing them access to the best of ANZ, including our platforms and technology. We strongly believe that the acquisition presents significant opportunities for ANZ, Suncorp Bank and our customers, as well as major public benefits including for Queensland," Elliott added.
Completion of the acquisition remains subject to legislative amendments by the Queensland Parliament and approval by the Federal Treasurer. If received, completion is expected "around mid 2024", according to a February 20 Suncorp statement.
If all approvals are met, then Brisbane-based Suncorp will become a standalone Property & Casualty (P&C) insurer focusing on Australia and New Zealand. ANZ and Suncorp have already made several reassurances to the state of Queensland about investment in the state after the sale. The Queensland government has had a long relationship with Suncorp.
The deal will enhance ANZ's status as a leading bank in Australia and could bring around A$260 million of pre-tax cost synergies according to the ANZ July 2022 announcement for the deal. Suncorp has a home loan book of around A$47 billion, A$45 billion in depostis and A$11 billion of commercial loans, according to the same announcement.
ACCC notes decision
Noting the decision from the Tribunal, ACCC chair Gina Cass-Gottlieb said in a February 20 statement: “The ACCC notes the decision and will reflect on it. The Tribunal’s decision demonstrates the checks and balances of an administrative merger approval process.”
“The Tribunal made findings on fundamental matters that informed our concerns, including that the national market for home loans is currently conducive to coordination and that material barriers to entry and expansion remain. However, the Tribunal didn’t consider that the proposed acquisition would meaningfully impact on the likelihood of coordination.”
“Banking markets are critical for many homeowners, businesses and farmers. The ACCC will continue to apply scrutiny to these markets across the breadth of our functions including merger assessments and enforcement investigations," added Cass-Gottlieb.
