ANZ confirms Thai bank talks

ANZ chief John McFarlane will report half-year results later this month. Story Tools

SYDNEY, Australia (CNN) -- Australia's ANZ Bank has confirmed it is talking to the Thai Military Bank (TMB) about buying a 20 percent stake, but said Wednesday there was no agreement yet.

Reports from Bangkok quoted TMB president Siri Ganjarerndee as saying Wednesday the bank planned to sell a combined 30 percent stake to ANZ and International Finance Corp., the World Bank's private investment arm.

ANZ spokesman Paul Edwards told CNN late Wednesday that any deal would be "months away" because of the need to conduct due diligence.

According to Thailand's Krungthep Thurakit newspaper, ANZ would pay about 7 billion baht (about $170 million) for a 20 percent stake.

ANZ said it had been approached by TMB about taking part in the Thai bank's capital raising program, and those discussions involved a possible shareholding of 10 to 20 percent.

"No agreement has been reached at this stage," it said in a statement released to the Australian Stock Exchange on Wednesday morning.

The bank, which ranks No. 3 in Australia by market capitalization behind NAB amd CBA, said its core strategy remained its domestic business.

But it said it also wanted to create a number of "strategic options" in Asia that would be a natural extension of its involvement in the region.

It said these would be modest individual investments that over time would build a portfolio likely to be about 5 to 10 percent of ANZ's capital.

TMB's board last week approved a recapitalization plan to issue 6 billion new shares, to help pay down debt and improve the bank's provisioning for bad debts. The plan will go to shareholders for approval at the end of this month.

TMB is Thailand's sixth biggest bank. In January it reported a loss of 160.3 million baht for 2002, down from a profit of 655.4 million a year earlier.

It is trading 5.25 percent higher at 4.02 baht late on Wednesday afternoon in Bangkok. ANZ shares closed 2.85 percent lower at A$18.05 in Sydney. The bank will report first-half earnings later this month.

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