ANZ’s attempted sale of its asset finance business UDC Finance to a foreign conglomerate will no longer take place, following stiff opposition from a regulator.
On 21 December, it was revealed that New Zealand’s Overseas Investment Office (OIO) had blocked an attempt by ANZ to sell its subsidiary UDC Finance to Chinese conglomerate HNA Group.
The major bank has now announced that the NZ$660 million ($604 million) sale will “no longer proceed”, with ANZ Group executive and New Zealand CEO David Hisco stating that the bank will need to revise its “strategic options”.
“Following the termination of the agreement with HNA, we’ll continue to assess our strategic options regarding the future of UDC, although there is no immediate requirement to do anything,” the CEO said.
Mr Hisco insisted that the blocked sale will not affect the finance subsidiary’s operations.
“It will be business as usual for staff and customers. UDC continues to be a very profitable business with a strong capital position and a growing loan portfolio across a range of industries,” the CEO added.
“Its focus remains on its core business of financing vehicles and equipment for people and companies across New Zealand.”
Following the announcement, ANZ’s share price dropped by 0.56 per cent, and as noted by ANZ after OIO’s rejection of HNA’s bid, the failed sale will affect the major lender’s forecasted FY18 earnings.
The bank recently sold its 20 per cent stake in Shanghai Rural Commercial Bank, and it also sold its life insurance business to Zurich Financial.