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HSBC, GE buy AMP businesses
SYDNEY, Australia (Reuters) -- Australian financial services group AMP Ltd said on Monday it would sell Aust. $2.8 billion ($1.7 billion) in residential mortgages and property loan assets to global banking group HSBC and GE Commercial Finance. AMP said the sale was part of a restructuring of its AMP Banking unit announced in November 2002 to prop up its beleaguered British life insurance operations, which have been pummelled by falling London stock prices. The agreed sale of the mortgage assets follows the sale of AMP's Australian and New Zealand credit card portfolio to American Express and a proposed transfer of its British banking portfolio to the U.K's Newcastle Building Society. AMP's shares are 1.24 percent higher at A$7.36 near the close Monday, outperforming the broader market. The shares have fallen around 70 percent over the past year as tumbling markets erode the British assets the company needs to back future payouts to policyholders. AMP said in a statement to the Australian Stock Exchange that HSBC would acquire A$1.6 billion in New Zealand residential mortgages and, subject to customer consent, take on AMP's A$355 million in New Zealand retail deposits. GE Commercial Finance, part of U.S. giant General Electric, will acquire A$1.25 billion of Australian and New Zealand commercial property loan assets. AMP gave no price for the transactions, but HSBC said in a statement it paid NZ$27 million ($15 million) for the mortgages. "An agreement has also been reached with AMP to distribute HSBC's range of retail banking products and services through AMP's advisor network in New Zealand," HSBC said. Steve Sargent, president and chief executive of GE Commercial Finance Australia/New Zealand, declined to reveal how much GE had agreed to pay for its package of commercial property loan assets. Copyright 2003 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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