In a research report from Morgan Stanley Australia, seen by finews.asia, the firm makes the case that instead of selling, ANZ should consider retaining its wealth business units.
In the report entitled «Should ANZ Exit Wealth» Morgan Stanley argues that ANZ no longer needs to sell its Wealth business just to boost capital.
With several wealth business units located in Asia finews.asia has been regularly reporting on the actions and undertakings of ANZ as they review the business.
Full Scale Sell-off Less Pressing
Earlier this year the Melbourne based bank announced plans to simplify its approach to wealth management, more closely aligning the distribution of wealth products and services with its Retail and Commercial businesses and focusing its insurance, superannuation and investments product business in Australia on improving returns and capital efficiency.
Three Scenarios for ANZ
The Morgan Stanley report suggests that the rationale for selling the «Wealth Assets» is less pressing than it was in 2015, as ANZ no longer needs to sell assets just to strengthen its balance sheet.
ANZ management, Morgan Stanley argues, have various options in Wealth, but do not need to be a forced seller. Morgan Stanley suggested there were three potential outcomes from ANZ's ongoing review of its wealth management namely, a life reinsurance deal, a sale of life reinsurance above 1-times book value or a full withdrawal from the wealth business.
A full wealth exit could release up to $6.4 billion, the Morgan Stanley note says.
