Australian competition regulator rejects $3.2-B ANZ-Suncorp Bank deal

The logo of the ANZ Bank is seen at Lambton Quay, in Wellington, New Zealand Nov 10, 2022. REUTERS/Lucy Craymer/File photo

Australia’s competition regulator said on Friday it had denied authorization for ANZ Group Holdings to proceed with its proposed A$4.9 billion ($3.21 billion) acquisition of Suncorp Group’s banking arm.

The Australian Competition and Consumer Commission (ACCC) said it was not satisfied that the acquisition would not lessen competition in the supply of home loans to Australian customers.

ANZ, while announcing the deal in July last year, had said buying Suncorp’s banking arm would boost its mortgage book by A$47 billion to A$307 billion and help it reclaim market share lost to main competitors.

READ: ANZ announces major banking takeover

The deal would have also helped Melbourne-headquartered ANZ expand its geographic reach into Queensland state, where Suncorp is based and has most of its business.

“Evidence we obtained strongly indicates that the major banks consider the second-tier banks to be a competitive threat,” ACCC Deputy Chair Mick Keogh said in a statement.

READ: Aussie competition regulator delays decision on ANZ’s $3.3-B Suncorp Bank buy

Keogh said the proposed acquisition would further “entrench an oligopoly” structure, with the country’s four major banks dominating.

ANZ and Suncorp said in separate statements that they were “disappointed” with the ACCC’s decision.

“We believe the acquisition will improve competition, which will benefit Australian consumers, particularly in Queensland,” ANZ said in a statement, noting that the ACCC’s decision can be reviewed by the independent Australian Competition Tribunal.