Suncorp transitions to dedicated trans-tasman insurer following completion of bank sale

Suncorp Group on Wednesday (31 July) finalised the AU$4.9bn (US$3.2bn) sale of its banking business to ANZ, a move initially announced in July 2022.

Suncorp Group CEO Steve Johnston described the sale as a “significant strategic milestone” for the company. “As a pureplay insurer, Suncorp Group can now look forward to investing in our business and delivering greater value for our customers and communities as well as our shareholders,” Johnston said.

Suncorp Group Chairman Christine McLoughlin added that the completion of the sale means Suncorp Group can now focus on being a dedicated Trans-Tasman insurance business “proudly headquartered in Queensland.”

The sale faced opposition from the Australian Competition and Consumer Commission (ACCC) with the consumer watchdog initially blocking the acquisition in August 2023.

The ACCC expressed concerns that the deal would reduce competition in Queensland’s home loan sector, SME banking, and agribusiness banking, and that it would further consolidate an oligopoly market structure dominated by four major banks.

However, in February, the Australian Competition Tribunal overturned the ACCC’s decision, saying that it found that the acquisition would not significantly lessen competition in any relevant market.

Following approval from the Australian Competition Tribunal on 20 February 2024, the Federal Treasurer and the Queensland Government granted the necessary approvals in June.

“Today is an exciting day for the ANZ Group, as we complete our acquisition of Suncorp Bank,” said ANZ Chief Executive Officer Shayne Elliott. “This strategically important acquisition boosts our presence in Queensland, adds scale to our Retail and Commercial businesses, and means we can compete more effectively across the Australian market.”

Johnston added that, with a heritage dating back to 1902, the insurer had been an important part of communities across Queensland and Australia. “I’m pleased the Bank has been handed over in good shape to ANZ, reflecting our clear strategy to improve its overall performance and risk maturity over the past four years.”

As part of the sale, Suncorp has agreed to invest in a disaster response centre of excellence in its Brisbane headquarters and establish a regional hub in Townsville, which is set to employ around 120 people.