subscribe to our newsletter
Major bank's $8 billion loan sale transforms M&A activity

Major bank's $8 billion loan sale transforms M&A activity

A major loan deal between two of Australia’s largest lenders helped bolster the value of corporate deals in the financial services sector in the 2016 financial year.

Released last week, the Mergermarket trend report FY 2016 found that in the lead up to the federal election (on July 2 2016), the Australian M&A market has been “tepid” in FY16.

The report noted that a total of 436 deals worth $85.3 billion have been announced, an 8.8 per cent decline compared to deal values in FY15 ($93.5 billion, 513 deals).

However, financial services bucked the trend, recording a 17.2 per cent share of all Australian M&A deals in 2016, up from 3.6 per cent for the 2015 financial year.

“With the announcement of the $8.2 billion acquisition of dealer finance business of Esanda Finance Corporation Limited by Macquarie Group, the financial sector ($14.7 billion, 39 deals) jumped to third place in terms of deal value, a significant 3.4x increase compared to the sector’s deal value in FY 2015 ($3.4 billion, 34 deals),” the report said.

ANZ announced the sales of its Esanda Dealer Finance portfolio to Macquarie Bank back in October. The portfolio included net lending assets of $7.8 billion, comprising retail point-of-sale auto finance of $6.2 billion, and wholesale bailment facilities and other Esanda branded finance offered to motor vehicle dealers of $1.6 billion.

The total purchase price for the portfolio is $8.23 billion.

Meanwhile, real estate ($1.3 billion, 9 deals) saw an 89.9 per cent slump in terms of deal value compared to the previous fiscal year ($13.0 billion, 11 deals), according to the report.

In the mortgage space, ASX-listed diversified financial services group Yellow Brick Road snapped up South Australian mortgage manager Loan Avenue in June, following the acquisition of an online investment company in March.

[Related: ANZ sells $8.2 billion loan portfolio]

 

Major bank's $8 billion loan sale transforms M&A activity
mortgagebusiness logo

Latest News

The lack of borrower understanding of interest-only loan terms, especially among owner-occupier households, is “concerning”, a global in...

The corporate watchdog is urging financial services and credit licensees to prioritise registering with AFCA as they would otherwise be in b...

A major bank has cut executive bonuses as it continues its efforts to regain public trust against the backdrop of the ongoing royal commissi...

FROM THE WEB

podcast

LATEST PODCAST: Upheaval at the major banks

Is enough being done to ensure responsible lending?