How are Bendigo Bank (ASX:BEN) shares reacting after ANZ deal?

July 06, 2022 08:03 PM PDT | By Ashish

How are Bendigo Bank (ASX:BEN) shares reacting after ANZ deal? — Image source: © Piter2121 | Megapixl.com

Highlights

Bendigo Bank has agreed to acquire the investment lending portfolio of ANZ.

Bendigo would acquire an investment portfolio worth nearly AU$715 million.

On completion of this acquisition, the combined value of Bendigo Bank’s margin lending portfolio would rise to over AU$2 billion.

Bendigo and Adelaide Bank Ltd (ASX:BEN) on Thursday announced the acquisition of the investment lending portfolio of Australia and New Zealand Banking Group Ltd (ASX:ANZ).

Following this update, shares of the regional bank jumped just over 1% to AU$9.39 in early trade. However, the stock has since then shed gains and was trading down 0.22% at AU$9.25 by 11:15 AM (AEST). The share price has slipped 0.5% on a year-to-date (YTD) basis, while in the past year the stock has fallen over 9%.

The bank would acquire an investment portfolio worth nearly AU$715 million, with about 11,900 customer facilities, as on 31 May 2022, Bendigo Bank said in its latest ASX filing. Following the completion of this acquisition, the combined value of Bendigo Bank’s margin lending portfolio would rise to over AU$2 billion. It is likely to happen in the first half of the calendar year 2023.

“The Bank will pay an immaterial premium over book value for the portfolio. Given the relatively small size of the acquisition, it will be funded through the ordinary course of business operations,” Bendigo Bank also said.

What did Bendigo Bank’s management say?

Commenting on the latest development, Bendigo and Adelaide Bank’s Managing Director and Chief Executive Officer (CEO) Marnie Baker said that acquisition of ANZ’s investment lending portfolio would further boost Leveraged Equities’ position as an industry leader in margin lending.

“The portfolio we are acquiring is well established and primarily comprises retail customers which will complement Leveraged Equities’ client base of professionals and clients under advice. We believe there is a strong future for Margin Lending in Australia, and this acquisition will create further opportunities for growth,” she noted.

Recently, the ASX-listed Bendigo Bank informed the exchange that it had entered into a deal with Australia Post for its Bank@Post services. The deal provided Bendigo Bank’s customers an access to banking services at over 3,500 post offices across Australia. The deal allowed small businesses and individuals to easily withdraw, deposit, and conduct balance enquiries without any charge.

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