ANZ Not Getting Out Of Wealth, Mulling Business Models - CEO

ustralia and New Zealand Banking Group, which has sold off its Asian wealth businesses as part of a restructuring, is not looking to exit the wealth area but is examining new models, the bank’s CEO has said.

The lender is examining a number of options for how to run wealth management going forward, such as a partnership structure for its insurance unit (much of ANZ’s domestic wealth business is done via insurance-based solutions).

Asked if ANZ is getting out of the wealth segment, Shayne Elliott said: “No. We look at it very simply. Insuring things that are important to you, including your life, insuring your home, saving for your retirement, these are good things. These are things that people should do. And we have an obligation to provide these solutions to our customers.

“We’re a natural place that they can come and have a conversation about that. But that doesn’t mean that we need to be actually manufacturing the product. So we want to partner with someone who is world class, who has the intellectual, the financial, the digital wherewithal to keep up and have terrific best in class products for those customers. But we will absolutely be in the business of providing those solutions to our customers,” he said.

“I think we have to keep a really open mind because this is a very different business model than we’ve had today - where the classical vertical integration where we own and operate everything. So it’s new, it’s a little bit different. There are other parts of the world that are very comfortable in this partnership model, but here in Australia and for ANZ, we’re going to keep an open mind,” Elliott said.

The CEO said the bank will put out an information memorandum shortly that will craft out a starting point for discussion.

Elliott said such a partnership idea for wealth is a “pretty big decision” and a move will take some time.

“And this is more about cultural fit and a partnership, not just a sale. We’re not just putting a ‘for sale’ sign up, that’s absolutely not what we’re doing. We’re seeking really to form a partnership for a very long period of time with an operator that we feel comfortable with and who wants to do the right thing by customers,” he said.

“I’d be very surprised if we have any major announcements before the end of this calendar year,” he said.

In October last year, ANZ sold its retail and wealth management business operating from Singapore, Hong Kong, China, Taiwan and Indonesia to DBS Bank, becoming the latest firm to spin off such operations to Singapore-headquartered lenders.

Since Elliott took the helm as CEO from Mike Smith at the end of 2015, ANZ has sold off a number of business arms and revamped its structure in a bid to sharpen profitability.


Nick Kalikajaros 2017