The competition watchdog is seeking more information on ANZ Bank\u2019s plan to buy Suncorp\u2019s banking unit for $4.9 billion, saying that it remains unconvinced the deal will deliver the public benefits claims put forward by the banking giant.<\/p>\n
The Australian Competition and Consumer Commission (ACCC) released a statement on Tuesday about its preliminary views on what would be the biggest transaction in Australian banking since Westpac bought St George \u2013 if the deal gets the green light from regulators.<\/p>\n
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ANZ has argued its plan to buy Suncorp\u2019s banking arm will deliver public benefits.<\/span>Credit:<\/span>Natalie Boog<\/cite><\/p>\n The watchdog\u2019s decision on the deal will be released in the middle of this year, and the ACCC must weigh up whether there is any substantial lessening in competition in banking, and whether that can be offset by public benefits from the merger.<\/p>\n In Tuesday\u2019s statement, the ACCC said second-tier banks such as Suncorp played an \u201cessential role\u201d in competing with the big four, and it would need to consider whether taking out a regional bank could remove a \u201ccompetitive constraint\u201d on the majors. It is particularly concerned about the deal\u2019s implications on agribusiness banking, small and medium enterprise banking, home loans and deposits.<\/p>\n While the ACCC did not say whether it would be likely to approve or oppose the transaction, it said it was so far unconvinced by ANZ\u2019s claims that the deal would provide public benefits to Queensland, or to prudential stability.<\/p>\n ANZ has argued the broader public would also benefit because the deal would make ANZ a stronger bank, which would allow it to serve customers more efficiently. However, the ACCC said it did not have the evidence to support this claim.<\/p>\n \u201cThe ACCC\u2019s preliminary view is that the information currently before it is insufficient to substantiate the nature, likelihood and extent of the claimed public benefits, including ANZ\u2019s estimates of future synergies that will be achieved and claims regarding public commitments to investment in Queensland or improvements in prudential stability arising from the Proposed Acquisition,\u201d the statement said.<\/p>\n The ACCC also said it was not clear whether Suncorp would be a stronger insurer without its banking unit, and it was unclear how any such benefits would be passed on to insurance customers.<\/p>\n In late morning trading ANZ shares were down 0.2 per cent at $23.18 and Suncorp shares were 1.6 per cent lower at $12.02.<\/p>\n ANZ chief executive Shayne Elliott said the bank would examine the regulator\u2019s preliminary views in detail and respond to the matters it had raised. \u201cWhen we announced the acquisition, we acknowledged that there would be questions from government and regulators about the competition aspects of this transaction, and we welcomed that scrutiny,\u201d Elliott said.<\/p>\n Suncorp maintained the view the deal was in the best interests of customers, shareholders and the community, and it would strengthen the nation\u2019s banking and insurance industries. It also said merging its banking unit with a regional bank would not deliver the same benefits as the sale to ANZ.<\/p>\n Morningstar analyst Nathan Zaia said it was understandable that the ACCC was looking closely at the deal, but he assumed it would go ahead in part because he thought Suncorp bank customers would be better off as part of a larger group.<\/p>\n \u201cA deal like this – it was always going to get a lot of scrutiny,\u201d Zaia said.<\/p>\n