"Bank of Queensland Ltd might merge with Suncorp-Metway Ltd's banking business, creating a banking group about the size of the former St George Bank Ltd.
According to a report in the Herald Sun newspaper, comments by Australian Competition and Consumer Commissioner chairman Graeme Samuel that it would examine "very rigorously" any further big bank takeovers of regional banks narrowed the options available for second-tier banks.
"Bank of Queensland has approached a range of local institutions in the last six months with a view of forging new strategic ties - many of those options have now closed except for Suncorp," a senior banking industry source told the paper.
"David Liddy [Bank of Queensland managing director] needs to improve the funding position of his bank and merging with Suncorp may represent an efficient way to do that," the source said.
Suncorp, which withdrew its banking arm from sale last year having attracted a $3.4 billion offer from ANZ Banking Group in October, could list its insurance arm should its banking arm merge with Bank of Queensland.
The source said, "From Suncorp's perspective, a merger is desirable because an independent Bank of Queensland would always constitute a competitive threat and an alternative home for Queensland banking customers."
So perhaps I will end up with some BOQ/SUN shares and some SUN Insuarnce shares??? At the moment the SUN Insurance would be getting smacked quite a bit. Another week of destruction in SE QLD, NTH NSW would be hurting the bottom line you would think.
SUN Price at posting:
$6.38 Sentiment: Hold Disclosure: Held
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