Suncorp ditches A$5m banking arm to focus on insurance

Australian insurance carrier Suncorp has agreed to sell its banking arm Suncorp Bank to Australia and New Zealand Banking Group (ANZ) for A$4.9 billion ($3.35 billion).

Suncorp’s insurance operations in both Australia and New Zealand will not form part of the transaction and the group’s head office will continue to be in Queensland.

The bank will continue to operate under the Suncorp Bank brand pursuant to a licensing agreement between ANZ and the group for a period of five years post completion.

Suncorp said the transaction is in line with its strategy of reshaping and simplification of the group, positioning both the insurance and banking business for future growth.

The deal is expected to yield net proceeds of $4.1 billion, the insurer stated.

Suncorp Group CEO Steve Johnston (pictured) said: “As a dedicated insurance business we will be singularly focused on meeting the needs of our customers and communities at a time when the value of insurance has never been greater.

“We acknowledge the needs of insurance customers are rapidly changing, with a preference for digital interactions and for product design to take into account personal circumstances and risk profiles. At the same time, the external environment has seen more frequent and severe natural hazard events resulting in increased costs and affordability challenges.

Suncorp chairman Christine McLoughlin added: “Both businesses will benefit from a singular focus on their growth strategies and investment requirements.

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