ANZ cleared to buy National

By PAULA OLIVER

The ANZ bank is a step closer to pulling off its biggest acquisition after gaining clearance from the Commerce Commission yesterday to buy the National Bank.

In a ruling that had been widely tipped across the Tasman, New Zealand's competition watchdog said it was satisfied the deal would not substantially lessen competition in the relevant markets.

The decision means ANZ is free to move on to the next stage of the sale process, which is lodging formal bids for the Lloyds TSB-owned bank.

An ANZ spokesman told the Business Herald from Melbourne last night his bank was happy with the decision but it could still be some weeks before anything else happened.

"This was required by Lloyds TSB before a bid could be lodged. It simply means that the Commerce Commission will allow us to buy NBNZ should we choose to proceed, and should we reach agreement with Lloyds TSB," spokesman Paul Edwards said.

"At this stage no commitments have been made by us, and the process still has some weeks to run."

ANZ is the only publicly known bidder left in the sale process.

Lloyds TSB has publicly stated that other parties are also interested, and global giant HSBC has been mentioned as a possible contender.

But London analysts have been cool on the prospect of an HSBC bid and it is understood the bank has indicated to some of them that it is not involved.

Talk of a National Bank float has heated up as potential bidders have fallen away, but that is still being seen very much as a back-up option should a trade sale fail to extract the price Lloyds TSB wants.

ANZ still needs to gain the approval of the Reserve Bank of New Zealand if it does decide it wants to pursue the purchase.

ANZ's interest in the National Bank is not winning it favour in its home country, where market analysts are worried that it will have to raise billions of dollars to go ahead with the deal.

Yesterday's clearance comes despite ANZ admitting in its application that the merged entity would break the commission's safe harbour guidelines in almost every market it operated in.

It is not yet known how the commission arrived at its decision because a public version of the report will not be available until next week.

Last night commission staff were unwilling to elaborate further than a statement confirming the clearance.

But it is likely that the recent burst of new entrants in the banking market coupled with the fact that four major operators would still be working among a relatively small population influenced the decision.