Bank of Queensland reportedly held merger discussions with Suncorp earlier this year, which would have involved Suncorp spinning off its insurance division.
The talk are said to have held in January and February following months of exploratory work done by investment banks Goldman Sachs and UBS.
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However, the two Queensland institutions decided against formal negotiations after Suncorp chief executive Patrick Snowball expressed doubts about the timing of the deal, according to local media reports.
One of Snowball’s concerns is believed to have been the impact the deal would have on the significant goodwill added to the company’s balance sheet from the $7.9 billion acquisition of insurer Promina Group in 2007.
Both institutions declined to comment on the revelation, first published in the Australian Financial Review.
A merger of the two banks would have generated an entity with $500 million in annual profit.
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