ANZ completes sale of asset finance business

ANZ has completed the sale of its New Zealand-based asset finance business, UDC Finance, to Japan’s Shinsei Bank.

The sale is reportedly worth NZ$762 million ($706 million) and, as at 31 March 2020, represented a price-to-book ratio of 1.2x net tangible assets of NZ$637 million ($590 million).

ANZ added that the sale provides approximately $439 million (~10 bps) of level 2 group CET1 capital at settlement and will release more than NZ$2 billion ($1.85 billion) of funding provided by ANZ New Zealand.

According to the bank, the sale follows a strategic review of UDC Finance in New Zealand and is “in line with ANZ’s strategy to simplify its business”.

This was ANZ’s second attempt to sell its asset finance subsidiary, after its first sale attempt with Chinese conglomerate HNA Group was blocked by the New Zealand Overseas Investment Office in late 2017.

Later, in 2018, the bank considered floating UDC Finance but decided against the move following its strategic review into the business. At this time, then ANZ New Zealand CEO David Hisco stated that a future sale of the business would continue to be considered.

The completion of the sale of UDC Finance comes just days after NAB entered into a Sale and Purchase Agreement to sell 100 per cent of MLC Wealth (MLC) to IOOF Holdings Ltd (IOOF) for a purchase price of $1.44 billion.

The transaction includes MLC’s advice, platforms, superannuation and investments, and asset management businesses.

However, NAB said it will retain legal ownership of MLC’s advice entities for the purpose of completing advice-related remediation programs (the bank has set aside approximately $1.5 billion for customer-related remediation provisions as of 31 March 2020).

[Related: NAB to sell MLC for $1.5bn]