Reuters Australia
Australia's CBA says no plan for St George Bank bid
Wednesday July 16, 06:16 PM
(Adds details)
By Marie McInerney
ADELAIDE, Australia, July 16 (Reuters) - Commonwealth Bank of Australia Ltd (ASX: CBA.ax) (CBA), the nation's second-biggest lender, has no intention of making a rival bid for St George Bank Ltd SSG.AX, CBA's chief executive said on Wednesday.
"Certainly we have no intention of making a bid for St George," CEO Ralph Norris told reporters after a business lunch.
St George, Australia's fifth-biggest lender, has agreed to be acquired by Westpac Banking Corp (ASX: WBC.ax) in a deal worth about A$14.2 billion ($13.9 billion). If the deal proceeds, it would be Australia's biggest banking takeover.
St George shares have mostly traded above Westpac's indicative offer price, leading some investors to believe that a rival offer was in the offing.
Westpac has bid 1.31 of its shares for every St George share.
Some analysts have speculated that CBA is the most likely rival bidder for St George.
"I think it is fair to say there is already an acquirer slated for St George," Norris said.
Westpac's plan to buy St George is being examined by the Australian competition regulator, which is widely expected to make its decision by the end of this month.
Local media have also named CBA as one of three likely bidders to buy the Australian arm of Dutch bank ABN AMRO. The Australian unit, ABN AMRO Holdings Pty Ltd, is being sold by a consortium led by Royal Bank of Scotland RBS.L. The consortium bought the Dutch group last year for about $99 billion.
"We look at any opportunities as and when it arises, but certainly I have nothing to say in that regard," Norris said when asked if CAB was interested in ABN AMRO Holdings.
Analysts value the business at about A$800 million.
Australian banks have avoided the worst of the global credit crisis but bad-debt charges are on the rise as many highly geared Australian corporates have struggled to refinance their debts.
Norris said he expected the challenging banking environment to continue for anything between 18 to 24 months.
St George shares closed up 3.6 percent at A$25.54, CBA up 3.3 percent at A$40.02 and Westpac up 4 percent at A$19.43. The benchmark S&P/ASX 200 index .AXJO was up 1.1 percent. ($1=A$1.02) (Writing by Denny Thomas by editing by Mark Bendeich)
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