In a reverse to former CEO Mike Smith’s aggressive Asian strategy, the Melbourne based banking group ANZ is considering the sale of its holdings in banks in Malaysia and China.
Current chief executive Shayne Elliott is turning his focus and commitment back to the bank's domestic market. In doing so he will be reversing several years of work to build a long lasting pan-Asian footprint.
ANZ’s Asian focus has come under scrutiny from investors as economies across the region have waned.
Financial news agency «Reuters» reports that ANZ has a 24 percent stake in Malaysian lender AMMB Holdings (AmBank), and a 20 percent stake in China's Shanghai Rural Commercial Bank. The stake in Malaysia's sixth biggest lender is valued at about $820 million and its holding in the Chinese bank is valued at almost $1.5 billion.
Wealth Fund Scandal
However finding a buyer for the Malaysian bank stake may prove to be a challenge due to the bank’s involvement in a political scandal linked to state fund 1MDB. In 2015 AmBank was hit with a hefty fine by the Malaysian central bank for breach of certain financial regulations.
Holding minority stakes in another lender is proving to be expensive for banks, new rules require them to set aside equity capital against such investments.
