Australia & New Zealand Banking Group Ltd (ANZ) may purchase Royal Bank of Scotland Group PLC’s (RBS) units in at least five Asian countries as the UK’s biggest government-controlled bank splits its assets in the region to attract buyers, three people familiar with the plan said.
Melbourne-based ANZ is in advanced negotiations to acquire RBS’ retail and commercial banking units in Hong Kong, Taiwan, Singapore, Vietnam and Indonesia, said the people, who asked not to be identified because the talks are confidential.
Standard Chartered PLC is seeking RBS’ businesses in China, India and Malaysia, two of the people said. The assets on sale may fetch about US$$1.5 billion, one of the people said.
“ANZ is getting a nice mix,” said Peter Vann, who manages more than US$600 million at Constellation Capital Management Ltd in Sydney, including ANZ Bank shares.
“The growth in the Asian markets I think will be a positive for them. It’s a nice little diversifying earner,” Vann said.
ANZ chief executive officer Michael Smith is expanding in Asia as swelling bad loans at home squeeze profit, prompting the bank to cut its dividend for the first time since the 1991 recession.
Smith, who previously headed HSBC Holdings PLC’s Asian division, is aiming to increase the proportion of income derived from the continent to 20 percent.
RBS is seeking to trim its operations in 36 countries that make up two-thirds of its international business after posting the biggest loss in British corporate history last year.
RBS chief executive officer Stephen Hester, who replaced Fred Goodwin after RBS sought a government bailout, is breaking up the bank’s Asian operation after potential bidders showed more interest in buying individual operations than the whole business, the people said.
ANZ disclosed its interest in RBS’s Asian units on May 27 and the negotiations are continuing, said Paul Edwards, a spokesman for the bank.
“For ANZ, the outcome remains unknown,” he said.
Michael Strachan, a spokesman for RBS in Edinburgh, declined to comment. Gabriel Kwan, a Hong Kong spokeswoman for Standard Chartered, also declined to comment.
ANZ sold A$2.5 billion (US$2 billion) in shares in May to fund a bid for RBS’s Asian assets.
The Australian bank said in January it paid US$114 million to increase its stake in Indonesia’s PT Bank Panin to benefit from rising demand for banking in Asia’s third-most populous nation.
ANZ also said it planned to open six new offices in Vietnam.
ANZ has more investments in Asia than its Australian rivals, including a 20 percent stake in Shanghai Rural Commercial Bank. It also has a holding in Saigon Securities Inc and a stake in Malaysia’s AMMB Holdings Bhd.
HSBC, which also focuses on emerging markets, declined to comment through its London spokesman Patrick McGuinness.
Standard Chartered chief executive officer Peter Sands said on March 17 the bank may consider purchases in Asia, Africa and the Middle East. The bank raised £1.8 billion (US$2.95 billion) in a December rights offering.