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ANZ to sell stake in Shanghai bank for more than $1.9 billion

Chief executive Shayne Elliot is reversing his predecessor's policy of expanding in Asia.

Nevil Gibson
Wed, 04 Jan 2017

ANZ has agreed to sell its 20% stake in Shanghai Rural Commercial Bank for 9.19 billion yuan ($1.9 billion), in the latest move to roll back its presence in Asia.

China Cosco Shipping and Shanghai Sino-Poland Enterprise Management Development will each acquire 10% of the Shanghai-based bank, says ANZ, which bought its stake in 2007 as it sought to expand in China.

Now, under the leadership of chief executive Shayne Elliott, who succeeded Mike Smith a year ago, ANZ has been cooling down its formerly aggressive Asia focus.

In October, ANZ agreed to sell its retail and wealth management businesses in China, Hong Kong, Indonesia, Singapore and Taiwan to Singapore’s DBS Group to focus instead on institutional banking in the region.

Further asset sales in Asia have been implied, In addition to Shanghai Rural Commercial Bank, ANZ holds stakes in Malaysia’s AMMB Holdings, PT Bank Pan Indonesia and Bank of Tianjin in China. 

ANZ earlier dropped a target to get up to 30% of its earnings from its Asia-Pacific, European and Americas division by 2017.

Mr Smith had been the chief architect of ANZ’s superregional strategy of expanding outside Australia and New Zealand, using his years of experience in the region to establish operations across Asia more vigorously than ANZ’s rivals.

But Mr Elliott said last year that the “environment we face has changed” and ANZ “would need to make further investments” that simply didn’t make sense for the Australian bank.

ANZ shares shares rallied 1.7% on the ASX to $A30.94 and have gained about 9% over the past year. The shares are about 40% higher than their low of last February.

Nevil Gibson
Wed, 04 Jan 2017
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ANZ to sell stake in Shanghai bank for more than $1.9 billion