ANZ has revealed ambitious plans to grow its
own-branded Asian branch network from 29 units to more than 200
outlets by 2012, and has restated its target of deriving 20 percent
of group net profit from the region over the next four years
compared with the current 7 percent. Douglas Blakey
reports.
ANZ, the most internationally-focused of Australia’s Big Four
banks, has said it is aiming to increase its Asian annual net
profit to A$1.5 billion ($1.43 billion) by 2012 and increase
customer numbers in the region from 131,000 to 1.5 million.
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It is also planning to boost its ATM network in the region from
155 to 1,000 units, increase credit cards in issue from 1 million
to 10 million and replace diverse IT systems with one core banking
network as it looks to derive 20 percent of group net profit from
Asia-Pacific by 2012.
ANZ’s group managing director, Alex Thursby, told analysts at
the bank’s five day Asian roadshow in mid June: “Our strategy in
Asia is primarily organic, but we will consider acquisitions.”
The group’s aggressive Asian ambitions will remain a key factor
in its mission to differentiate itself from its Australian rivals.
In its first half results for fiscal 2008, published at the end of
April, the group reported “very strong growth” in Asia-Pacific –
profit shot up 47 percent (58 percent foreign exchange adjusted)
compared to an overall group profit decrease of 7 percent.
At the heart of the bank’s international strategy is its aim to
rank as one of the four largest international banks in China and
India as well as growing its presence in Indonesia, Malaysia and
Vietnam. According to Thursby, the bank will grow on a “city by
city” basis and ANZ’s growth strategy will vary from country to
country. “Our strategy is based on the view that one size does not
fit all.”
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By GlobalDataQuick to move into China
Like HSBC, Standard Chartered, Citi and a slew of other foreign
banks – research from consultant PwC says there are now 42 in the
country, a figure that will grow to nearer 100 by 2010
(see news Digest) – ANZ has
been quick to move into China, with a 19.9 percent stake in
Shanghai Rural Commercial Bank in addition to its 19.9 percent
stake in Tianjin City Commercial Bank.
In a rare set-back, in May
the bank failed to acquire Hong Kong’s Wing Lung Bank, losing out
to China Merchants Bank (see RBI
593). ANZ had sought to snap up Wing Lung to further its
push into Asia. Asked about his bank’s failure to acquire the Hong
Kong lender, ANZ’s CEO Mike Smith said at the time he was of the
view that CMB had overpaid. “Why would you pay three times book for
an institution like that?”
Speculation is now likely to turn to other potential takeover
targets in Hong Kong, including Wing Hang Bank, Chong Hing Bank and
Dah Sing Bank.
In China, Taiwan and Hong Kong, ANZ believes that scale and
scope will become increasingly important.
ANZ is keen to target the affluent high-net worth sector in the
region; in Hong Kong, in particular, ANZ will look to target
increased market share of the expatriate market, extend its wealth
offering into advisory services and remain vigilant on possible
merger and acquisition opportunities.
In Indonesia, a country of 235 million people offering potential
loans and deposit growth of 10 to 15 percent per annum over the
next four years, ANZ estimates there are already 4.6 million
affluent and emerging affluent retail customers.
Its plan is to become a full service bank targeting the affluent
consumer market and aims to increase branch numbers from two to 42.
It also owns a 30 percent stake in Panin Bank, the country’s
sixth-largest bank by assets.
A bankable population
Targets for the buoyant Vietnamese market, in which ANZ has a 10
percent stake in the 215-branch-strong Sacombank, include an
increase in ANZ branch numbers from two to more than 50 outlets and
an increase in credit cards in issue from 20,500 to around one
million.
ANZ will concentrate its focus on Hanoi and Ho Chi Minh City,
two cities with a combined bankable population of seven million
including an affluent/emerging affluent segment of 820,000 people,
which ANZ estimates is growing at around 30 percent per year.
Perhaps the Australian bank’s most exciting market, however, is
the one just west of Vietnam, Cambodia. ANZ’s launch of ANZ Royal
in Cambodia in 2005 is already being heralded as a major success
far exceeding the bank’s original expectations, with deposit
account numbers growing at 38 percent per annum, boosted by the
only online internet banking service in the country, the largest
ATM and the second largest branch network.
ANZ’s CEO in Cambodia, Stephen Higgins, said the rapid success
in the country – key metrics are three times higher than the
original 2005 plan stated – was “proof that we can rapidly build a
leading retail bank”.
