ANZ to acquire Suncorp banking arm for $3.3 bn

The smallest of Australia’s big lenders, Australia and New Zealand Banking Group is purchasing the banking division of insurer Suncorp Group for A$4.9 billion ($3.33 billion), hoping to restart domestic growth after lagging behind rivals.

The deal, which was announced on Monday, will help ANZ gain ground on National Australia Bank Ltd. for third place in the industry by expanding its retail presence in a rapidly expanding domestic region and nearly tripling its assets in mortgages, the most lucrative line of business for Australian banks.

ANZ has previously had significant growth in Asia, which has recently been slowing down. By market value and various other criteria, it trails Commonwealth Bank of Australia, Westpac Banking Corporation, and NAB.

“It’s not offshore, it’s not away from their core capabilities, in terms of acquisitions this is not a bad one,” said Hugh Dive, chief investment officer at Atlas Funds Management, which owns shares of ANZ and Suncorp.