Westpac-St. George get tick of approval

Australian Banking & Finance, Sept 15, 2008

The Australian Competition and Consumer Commission (ACCC) has said it will not oppose the proposed union of Westpac and St.George.

"The ACCC has concluded that the proposed acquisition of St George by Westpac is unlikely to substantially lessen competition...," it said.

The competition watchdog said while St.George is a "relatively innovative and dynamic competitor" with a strong focus on customer service, "other competitors to the merged entity which remain in the market will continue to play a similar role."

"In particular, the ACCC considered that competition in retail banking markets provided by the other major banks and regional banks along with credit unions, building societies and niche players, would be sufficient to constrain the merged firm after the acquisition," ACCC chairman Graeme Samuel said.

"The ACCC acknowledges the role that regional banks have played in challenging the major banks, particularly as they have entered new states and competed aggressively to gain market share."

The ACCC issued its preliminary views in a statement of issues in July in which it identified the aggregation of the BT (Westpac) and Asgard (St.George) wrap platforms as a preliminary competition concern.

"Further market inquiries have since revealed that there are a range of substitutable products, including master trust platforms and, increasingly, separately-managed accounts, available to financial planning businesses and investors," the ACCC said.

Both banks welcomed the decision.