ANZ in Aggressive Push To Increase Market Share In Business Banking

Post by NeilMc on July 8, 2009 · Under Australian Economy, Business News, banking · 4 Comments

Australian banks expect very moderate growth in their business lending portfolio as debtor companies, de-leverage their balance sheets and show less appetite for credit.

Despite the anaemic growth, the Big Four lender ANZ has signalled its intention to focus more resources on the sector. The Australian banking major announced a senior hire from rival Westpac to head up its business banking division.

Jeremy Dean, formerly head of premium business banking at Westpac, will join ANZ as head of business banking, reporting to group managing director, commercial banking, David Hisco.

Mr. Hisco said yesterday that ANZ expected either flat or marginal growth in its business lending portfolio.

“If we can maintain the book, or slightly grow it, then that will be a reasonable achievement in the current environment. With our (super-regional) strategy, we think we should be the commercial bank of choice for businesses looking to transact into Asia or New Zealand.” he said.

ANZ’s commercial banking business is split into four divisions, with two units servicing businesses based on revenue, whilst a further unit serves agribusiness and asset finance.

ANZ intends to lend as much as $8 billion to small business this year and will scale up its head count in business banking through the hiring of 150 new staff.

ANZ aggressive strategy comes against a backdrop of a market expected to contract or at the very least, remain flat.

The Australian central bank, The Reserve Bank of Australia said on Tuesday that demand for mortgage finance has risen but that business demand for credit had fallen as companies postponed investment plans and reduced leverage in an environment of tighter lending standards.

The central bank said that larger firms had strengthened balance sheets through access to equity capital.

ANZ’s Hisco said ANZ could increase its markets share of small business banking without having to use its balance sheet to make loans.

“We’re focusing on building relationships, and that could mean trade and foreign exchange — you don’t need to grow your assets to grow the business,” he said.

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