ANZ exits Asia wealth

01-Nov-2016

By Daniel Paperny

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ANZ would retreat from its retail and wealth operations in Asia and shift its focus to institutional banking operations in the region, the bank announced yesterday.

The bank revealed it had formed an agreement to sell its retail and wealth business in Singapore, Hong Kong, China, Taiwan and Indonesia to Singapore’s DBS Bank, in a back-down from the previous regional expansion strategy pursued by former chief executive Mike Smith.

ANZ chief executive Shayne Elliott said while Asia remained core to ANZ’s strategy, the group’s strategic priority was to form a “simpler, better-capitalised and better-balanced” bank.

“This transaction simplifies our business while allowing us to continue to benefit from higher levels of growth in the region through a focus on our largest, most successful business in Asia - banking large corporate and institutional clients driven by trade and capital flows, particularly with Australia and New Zealand,” Elliott said.

“By focusing our resources in Asia - whether that is capital, technology or people – on institutional banking, we can continue to build a world-class, capital-efficient business by strengthening our network and the support we provide to our key institutional clients.”

He admitted while the bank had grown a profitable retail and wealth business in Asia, it could not maintain a competitive position in the region without greater scale.

“[We are] focused on attractive areas where we can carve out winning positions,” he said.

“Having looked carefully at the business in recent months, it is clear the environment we face has changed and to make a real difference for our retail and wealth customers, we would need to make further investments in our Asian branch network and digital capability.”

The agreement with DBS is subject to regulatory approval, but once received, ANZ said it expected the sale of its Asian retail and wealth businesses to be completed during 2017 and early 2018.

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