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Westpac pulls out of NZ bank bid
SYDNEY, Australia (CNN) – Australia's third-largest bank, Westpac Banking Corp, has pulled out of the $4 billion bidding for Lloyds TSB's National Bank of New Zealand. Westpac said Friday it would not be proceeding with the bid process because it considered it would be a diversion from its core "organic growth strategy". Westpac's decision leaves only Australia's ANZ Banking Group as a declared contender for NBNZ, though various other parties have expressed interest in taking a stake in New Zealand's biggest bank. They include a New Zealand consortium known as the Black Horse group, which is trying to raise funds for a bid. Global banks HSBC and Citibank have also been mentioned as potential bidders, along with Singapore's DBS Bank. Westpac's withdrawal lessens the pricing tension, raising the possibility that Lloyds may opt for a public float rather than a trade sale. Lloyds decided earlier this year to review its ownership of NBNZ after receiving several approaches. Analysts expect a sale of NBNZ, set up by Lloyds in 1872, could raise up to $4 billion. NBNZ has total assets of NZ$38.9 billion ($21 billion) and last year posted a record after-tax profit of NZ$503 million. The big four Australian banks initialy were seen as the most likely bidders, but only ANZ and Westpac took the first step of applying to the competition regulator, the New Zealand Commerce Commission. Australia's biggest bank, National Australia Bank, is occupied with its potential bid for Australian life insurer and funds manager AMP, once AMP completes a split of its troubled UK operations. In addition, the NAB already has a 20 percent-plus share of the New Zealand market via its ownership of Bank of New Zealand. Second-ranked Commonwealth Bank of Australia, which owns ASB Bank in New Zealand, has not shown any interest in NBNZ. Westpac, which already has just under 20 percent of the New Zealand market through its ownership of Trust Bank, said Friday it would "continue to focus on its existing customer base and its organic growth strategy."
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