ANZ-Suncorp deal: Union boss warns deal will trigger thousands of job losses and branch closures
A union boss has warned the ANZ-Suncorp deal would put thousands of employees out of work and trigger mass closures of dozens of bank branches.
ANZ on Monday announced its proposed purchase of smaller rival bank Suncorp for $4.9 billion – marking it as the country’s biggest banking deal in 14 years.
The bank’s chief executive, Shayne Elliott, has pledged to retain Suncorp’s Queensland branches and staff for at least three years.
However, the Financial Sector Union (FSU) is skeptical and has warned thousands of workers will lose their jobs when the three-year period ends.
Queensland Secretary Wendy Streets told Daily Mail Australia that both ANZ and Suncorp employees should be aware of the consequences of the deal.
A union boss has warned the ANZ-Suncorp deal will cost thousands of employees and trigger mass closures of dozens of bank branches
ANZ on Monday announced a proposed purchase of smaller rival bank Suncorp for $4.9 billion – marking it the country’s biggest banking deal in 14 years.
He said job security issues would be exacerbated for both parties adding that while ANZ had pledged to maintain staff numbers on Suncorp’s side, no commitment to ANZ’s employees was in danger of being ‘duplicated’.
“They all need to be concerned,” Ms Streets said, adding the union had requested an urgent meeting with Treasurer Jim Chalmers to voice their concerns.
FSU Secretary Julia Angrisano predicts the back-office function will be the first to leave with ANZ to then proceed with the extension of its ‘aggressive bank closure programme’.
“This is bad for jobs and bad for competition and FSU will apply to Treasurer Jim Chalmers and the ACCC, asking them to reject this deal,” the secretary said in a statement on Monday.
FSU secretary Julia Angrisano (pictured) warns Suncorp deal is part of ANZ’s ‘aggressive bank closure program’
Shayne Elliott of ‘ANZ voiced no net job losses for three years. What he really means is that there is no future for our thousands of members across Queensland after three years.’
‘Now is not the time to close branches and reduce competition in the banking sector. With mortgage rates rising, it’s more important than ever to maintain competition.’
Angrisano said the deal was ‘all about profit’ for ANZ and claimed the bank had absolutely no interest in the public interest or investing in Queensland.
He ANZ only wants benefits from Suncorp $47 billion in home loans, $11 billion in business loans, $45 billion in deposits, and 1.2 million customers.
‘This is a corporate marriage made in hell for Suncorp Bank staff. ANZ has not been willing to negotiate a new collective Corporate Agreement for the last six years and the expiring Suncorp Agreement has been in effect for three years,’ he said.
‘These two companies clearly share the same culture of putting profit above people. They do not respect the collective voice of their workers and they cannot be trusted to maintain banking services to the Queensland people.’
‘This takeover will cost jobs and kill Suncorp Bank’s presence as a brand throughout Queensland.’
ANZ made big strides on Monday – announced it would buy rival bank Suncorp for $4.9 billion
ANZ bought Suncorp’s banking arm, but not its insurance arm, with ANZ initiating a $3.5 billion fundraiser from its shareholders to help fund the transaction.
Suncorp said that by selling its bank, the group would have more time to focus on its insurance arm which had been overwhelmed by recent flooding on Australia’s east coast.
The bank held an ‘all town hall employee’ meeting on Tuesday to discuss changes with the fate of Suncorp staff outside Queensland still hanging in the balance.
The deal will be reviewed by Australian Competition and Consumer Competition to determine whether it will reduce competition.
Treasurer Chalmers acknowledged Suncorp was a key financial player in the Queensland economy and said he would seek expert advice before making his call.
ANZ chief executive Shayne Elliott said: ‘The acquisition of Suncorp Bank will be a cornerstone investment for ANZ and a vote of confidence in Queensland’s future.
‘With much of the work to simplify and strengthen the bank completed, and our digital transformation well underway, we are now in a position to invest and reshape our Australian business.
“This will result in a stronger and more balanced bank for customers and shareholders.”
Suncorp said its insurance operations in Australia and New Zealand would not be part of the ANZ transaction, adding that its group headquarters would remain in Queensland.
ANZ’s $4.9 billion cash purchase of Suncorp Bank represents a $1.3 billion goodwill premium on Suncorp’s net tangible assets.
The news caused Suncorp’s share price to surge 6.49 percent to $11.82, within half an hour of opening trading on the Australian Stock Exchange, as the broader S&P/ASX200 gained 0.75 percent.
ANZ shares were suspended through July 21 in Australia and New Zealand as they embarked on a $3.5 billion capital increase.
Shareholders will be entitled to one new ANZ share for every 15 ANZ shares they hold on 21 July, 7pm Melbourne time.
Suncorp customers may notice little difference in service in the short term, with ANZ committed to opening a corporate bank branch for at least three years (pictured is the Brisbane branch)
ANZ, with 8.5 million customers, is the fourth largest bank in Australia while Suncorp, with 800,000 customers, is the sixth largest bank.
Clive van Horen will remain chief executive of Suncorp Bank, reporting to Elliott and will join the ANZ Executive Committee once the transaction is complete.
Under the agreement, ANZ will pay Suncorp Group a license fee for five to seven years to use its name.
That means ANZ will pay a minimum fee of $50 million to use the Suncorp Bank brand, an average of $10 million per year under the brand licensing agreement between Suncorp Group and ANZ.
If this license agreement is extended, Suncorp will receive an additional $10 million per year.
Suncorp Chair Christine McLoughlin said: ‘This proposal has been assessed through the lens of creating shareholder value and, equally important, to ensure there is alignment of purpose and values and positive outcomes for our employees and customers.’
ANZ under this deal has pledged to allocate $15 billion in new loans to support Queensland’s renewable energy projects and green Olympic infrastructure over the next decade.
ANZ chief executive Shayne Elliott said: ‘The acquisition of Suncorp Bank will be a cornerstone investment for ANZ and a vote of confidence in Queensland’s future’
ANZ’s acquisition of Suncorp marks the biggest takeover of a smaller bank by any of the big four since Westpac’s December 2008 acquisition of St George.
Westpac’s chief executive at the time, Gail Kelly, previously ran St George, which in 1997 bought Advance Bank.
Commonwealth Bank in 2008 bought Perth-based lender BankWest and in 2013 completely took over mortgage broker Aussie Home Loans, founded by John Symond in 1992.
ANZ will need approval from the Australian Competition and Consumer Commission to proceed with the acquisition of Suncorp Bank.
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