Bendigo and Adelaide Bank says that it, not ANZ, should be the one to acquire Suncorp's banking arm
Bendigo and Adelaide Bank says that it, not ANZ, should be the one to acquire Suncorp’s banking business.
Bendigo Bank has called on the Australian Competition and Consumer Commission to reject ANZ’s $4.9 billion takeover of Suncorp bank, claiming the deal would harm competition, according to a report by The Australian.
The ACCC is currently assessing the Suncorp-ANZ merger, and is expected to announce its decision by June 12, the publication said.
Bendigo Bank said in its submission to the regulator that ANZ’s purchase of Suncorp’s banking business would “substantially lessen competition in home loans, deposits, and agribusiness markets” and that the deal was “not to be likely to result in any public benefits that are sufficient to outweigh the public detriments likely to result from such a pairing.”
Instead, Bendigo Bank suggested that it should be the one to acquire Suncorp’s banking arm, according to The Australian. Bendigo said such a deal would better serve consumers because it would “limit further concentration of the major banks and increase the likelihood of co-ordinated effects.”
Advantages of a Bendigo-Suncorp union
Bendigo claimed that a merger with Suncorp would “effectively double its scale, which immediately enhances its competitive advantages such as the ability to achieve cost efficiencies from synergies, attract deposit funding, increase investment in technology accelerating the delivery of Bendigo’s digital capabilities and reducing its cost of funding and cost of capital.”
Read next: Regulator should block ANZ-Suncorp deal – analyst
While Suncorp’s own submission to the ACCC said that a deal with Bendigo and Adelaide Bank wasn’t viable, Bendigo Bank claimed that if not for the proposed ANZ acquisition, there was “a real chance that Bendigo would merge with Suncorp bank.”
A potential tie-up between Bendigo Bank and Suncorp has been kicked around for some time. Bendigo made its latest approach weeks after Suncorp agreed to sell its banking arm to ANZ, The Australian reported. However, Bendigo Bank claimed that Suncorp never seriously engaged with its offer.
“A disaster for effective competition”
Bendigo Bank insisted that the ANZ-Suncorp merger would stifle competition.
Were Bendigo and Suncorp to merge, the combined bank would control 5.2% of all home loans in the market and 4.3% of all deposits, The Australian reported. A Suncorp-ANZ combo, on the other hand, would control 14.5% of all deposits, Bendigo Bank estimated.
“The proposed acquisition would remove the opportunity for innovative and effective competition in savings and term deposit markets,” Bendigo Bank said.
Economists and consumer groups have also expressed concerns about the ANZ-Suncorp deal. Gerard Brody, chair of the Consumers Federation of Australia, said in January that the deal would be “a disaster for effective competition.
Have something to say about this story? Let us know in the comments below.
