In late 2010 Mike Smith was pushing ahead to move ANZ further into northern Asia via an acquisition in South Korea.
ANZ Banking Group is continuing to conduct due diligence on Korea Exchange Bank, according to chief executive Mike Smith.
“We’re still in the middle of that and it’s very hard for me to say much more than that,” Mr Smith said at a business lunch.
US private equity player Lone Star Funds wants to sell its 51 per cent stake in Korea Exchange Bank and ANZ said in August it was conducting due diligence on taking a stake in the bank.
ANZ is yet to confirm a report Hana Financial has acquired Lone Star’s 51 per cent stake in Korea Exchange Bank for about $US4.2 billion.
The deal, reported in The Wall Street Journal, came as a shock to the ANZ which was conducting due diligence on KEB and was thought to be the only real buyer in the race.
It would also be a blow to ANZ even if the reported purchase price is above the levels it was prepared to pay.
It was also assumed the Korean government would not look kindly on the deal given Lone Star’s mixed reputation in Korea and that Hana, a Korean retail bank, was a front running for the coming sale of the government stake in Woori Finance.
bullet dodge” because the Korean banking system is far less stable than many people suspected. Paying a high price for this instability could have been a disaster. However earlier this year, even after the failed KEB bid, Mike Smth was still very upbeat about ANZ making a strategic push into Northern Asia.
ANZ Bank is revamping its regional expansion strategy, raising the profile of north Asia, after the failed tilt at Korea Exchange Bank.
Chief executive Mike Smith said the KEB deal, for which ANZ undertook extensive due diligence in August only to be pipped at the post by Korea’s Hana Financial Group, had “reopened my eyes” to the potential of north Asia.
“Because Japan and Korea are more developed economies, you don’t think about their potential so much and you tend to get obsessed by the opportunities in greater China, greater Mekong (mainly Vietnam), Southeast Asia and India,” Mr Smith told The Weekend Australian.
“Quite interestingly, KEB has reopened my eyes to the possibilities in northern Asia.”
So I have to wonder what Mike would be thinking if all of a sudden a number of cheap Korean banking assets came onto the market. Today could be his day.
Kim Seok-dong, the chairman of the Financial Services Commission, said yesterday that he would not discriminate between foreign and domestic investors who might want to acquire local savings banks.
There is speculation within the financial sector that some foreign financial groups might be interested in buying savings banks.
“I don’t exactly know who wants to acquire our savings banks, but we will let them do it within our rules. At least when I am serving my term, they [foreign firms] will not be discriminated against in the Korean market”, Kim told a meeting of foreign correspondents yesterday.
Wanna try again Mike ?