ANZ In Advanced Negotiations To Acquire Five Asian Units From RBS

Post by Sharat on July 1, 2009 · Under Australian Economy, Business News, Company News, Mergers & Acquistions, banking · Comment

Australian banking major Australia & New Zealand Banking Group (ANZ) is thought to be keen on acquiring the operations of quasi nationalized UK bank Royal Bank of Scotland’s (RBS) operations in at least five countries in the Asia region as the lender splits up its regional assets in order to make the sale more attractive for potential bidders, according to a report by Bloomberg.

The report which cited three unnamed sources familiar with the negotiations, says that the Melbourne based lender is at an advanced stage of negotiations for the acquisition of retail and commercial banking operations of RBS in Hong Kong, Singapore, Taiwan, Vietnam and Indonesia.

The report also suggests that the British bank Standard Chartered, is interested in acquiring RBS units in China, India and Malaysia, with the sale of asset sales generating as much as US$1.5 billion for RBS.

ANZ chief Mike Smith who has made public his strategy of turning ANZ into a “Super Regional” lender that derives 20 per cent of its revenue internationally, has ambitious Asian expansion plans, as rising credit impairment charges in Australia puts pressure on profits, prompting the Australian based banking group to cut its dividend payment for the first time since 1991.

RBS which last year posted the biggest loss in UK corporate history is looking to rationalize its operations, in as many as 36 different countries that account for two thirds of its global business.

RBS chief executive Stephen Hester has had to divide up the Asian business into individual country units after potential bidders balked at the prospect of buying the entire portfolio, and showed more interest in acquiring individual operations.

ANZ confirmed its interest in RBS’s Asian operations on May 27th, and a spokesman for the lender Paul Edwards said that negotiations are on going.
“For ANZ, the outcome remains unknown,” he said.

Spokespersons for both RBS and Standard Chartered declined to comment.

In May ANZ raised A$2.5 billion in capital through a share sale, largely to finance its bid to acquire RBS assets.

In January ANZ said it paid $114 million to increase its holding in Indonesian bank PT Bank Panin. ANZ said it also intends to increase its presence in Vietnam by opening as many as six new offices there.

Of the Big Four Australian banking groups, ANZ has the most invested in Asia with a 20 percent stake in Shanghai Rural Commercial Bank and sizeable holdings in Saigon Securities and Malaysia’s ANMB Holdings Bhd.

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