With revamp complete ANZ poised to grow institutional business in Asia
The Melbourne-headquartered Australian bank expects 5pc revenue growth from its Asian institutional operations
A slimmed down ANZ, which embarked on a restructuring of its Asian operations in 2016, is now fully focused on institutional banking in the region, says Mark Whelan, head of institutional banking.
The sale of a 55 per cent stake in ANZ Royal Bank in Cambodia to Japanese financial group, J Trust, in May, marked ANZ’s official exit from Asia’s retail market.
The deal, expected to complete the first quarter of 2019, will generate a loss of A$30 million (US$21.76 million) to the bank, and underscores what had been a costly restructuring exercise for the past two years.
Australia’s third largest bank by market capitalisation started winding down its Asian business two years ago, selling its retail and wealth units in Singapore, China, Hong Kong, Taiwan and Indonesia to DBS, after it chose not to continue to scale up the operations. The exercise cost it A$265 million in writedowns.
But it also helped Melbourne-based ANZ shave as much as A$50 billion in risk-weighted assets (RWA) in Asia and elsewhere, representing about 25 per cent of its peak RWA of A$204 billion in 2015.
“These Asian business restructuring, alongside ANZ’s other disposals of retail finance business in Australia, has since generated A$6 billion in capital back to the group. Over the next three years, the bank anticipates on average 4 to 5 per cent revenue growth each year from across all divisions in Asia,” said Whelan.
