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Suncorp Group (ASX:SUN) Chairman Christine McLoughlin has hailed the Australian Competition Tribunal’s approval of ANZ’s (ASX:ANZ) proposed $4.9 billion acquisition of Suncorp’s banking business as a “big win” for the Sunshine State.
This comes after the Australian Competition and Consumer Commission (ACCC) blocked the acquisition on August 4, 2023, citing concerns about reduced competition in Queensland, particularly in home loans, small business banking, and agribusiness banking.
The ACCC was particularly worried about the potential for an “oligopoly market” dominated by the four major banks.
Despite the initial rejection, ANZ and Suncorp appealed to the Tribunal, which concluded the acquisition wouldn’t substantially reduce competition.
While acknowledging some claimed public benefits weren’t genuine, the Tribunal ruled potential drawbacks were uncertain and unlikely to outweigh the benefits of integration.
“The Tribunal made findings on fundamental matters that informed our concerns, including that the national market for home loans is currently conducive to coordination and that material barriers to entry and expansion remain,” ACCC Chair Cass-Gottlieb said.
“However, the Tribunal didn’t consider that the proposed acquisition would meaningfully impact on the likelihood of coordination.
“The ACCC will continue to apply scrutiny to these markets across the breadth of our functions including merger assessments and enforcement investigations.”
The decision marks a pivotal moment for these banking giants and sets the stage for potential industry shifts.
“This is a significant milestone and an important step forward in the process, however, we still have further conditions to meet,” ANZ Chief Executive Officer Shayne Elliott said.
“We remain committed to completing the acquisition as soon as possible once all sale conditions are met.”
“Suncorp Bank is a high-quality business with a strong team and excellent customer base, and we look forward to bringing them access to the best of ANZ, including our platforms and technology.”
