2nd UPDATE: ANZ Bank May Take Another Look At RBS' China Operations
October 06 2009 - 1:40AM
Dow Jones News
Australia & New Zealand Banking Group Ltd. (ANZBY) may take
another look at Royal Bank of Scotland Group PLC's (RBS.LN) banking
assets in China after Standard Chartered PLC pulled out of talks to
buy the operations, a spokesman for the Melbourne-based bank said
Tuesday.
"ANZ would be prepared to look at the RBS assets in China if
financial sense could be made of that," the spokesman said. "At
present, however, our priority is around regulatory approvals and
integration planning for the assets in the six countries where we
have already reached agreement with RBS," he said.
ANZ Bank isn't currently in any discussions with RBS on the
China operations, he said.
ANZ Chief Executive Mike Smith, a former HSBC executive, wants
to transform Melbourne-based ANZ into a "super regional bank"
competing with the likes of HSBC and Citigroup. He hopes to
generate 20% of ANZ's revenues from Asia by 2012 amid intense
competition and slowing loan growth in its home markets.
In what it described as a stepping stone into the region, ANZ
agreed in August to buy some of RBS' retail and commercial banking
operations in Asia for US$550 million.
Under that deal, ANZ will buy RBS' retail and commercial banking
operations in Taiwan, Singapore, Indonesia and Hong Kong, and its
institutional businesses in Taiwan, the Philippines and
Vietnam.
But it baulked at buying the China operations due to price,
Smith said at the time.
EL & C Baillieu Analyst Ivor Ries said it would make sense
for ANZ to buy the China operations - but only at the right
price.
"The China operations are not very big, so it wouldn't be of
great consequence but would probably speed up what ANZ are doing in
Asia by a year or two," Ries said.
Talks between Standard Chartered and RBS for the sale of RBS'
assets in China, India and Malaysia failed over price, a person
familiar with the matter told Dow Jones Newswires on Saturday.
The person said Standard Chartered was willing to pay US$200
million to US$250 million for the assets but RBS was expecting much
more.
ANZ already has some presence in China. It holds banking
licenses in three major cities, and holds stakes in Bank of Tianjin
and Shanghai Rural Commercial Bank. It is also in the process of
getting local incorporation in China.
ANZ Bank still has significant cash to help fund any
acquisitions, even after striking a EUR1.1 billion deal last month
to buy out its Australian wealth management venture partner ING
Groep NV (ING) to boost its share in the fast growing sector.
Australia's well capitalized banks have been taking advantage of
the distressed positions of some of their global peers to build
market share.
ANZ has indicated that it isn't interested in RBS' banking
operations in India at this stage, given it doesn't have a banking
license in that country.
"While India remains a priority market, our immediate focus
there is working to progress the application for a banking license
that ANZ made in late 2008," the spokesman said.
-By Lyndal McFarland, Dow Jones Newswires; 61-3-9292-2093;
lyndal.mcfarland@dowjones.com
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