From WBC to ANZ: Why are these NZX banking shares in news today? – Kalkine Media

The banking sector reported growth despite an economic slowdown in New Zealand. The big banks reported strong FY22 results. The big two banks also made significant announcements today, which are likely to have an impact on their businesses and bottom lines. Their respective shares were trading mixed on Monday.

Earlier, the banks were also impacted by the OCR hike delivered by the Reserve Bank of New Zealand (RBNZ). Last week, the central bank raised the OCR by 50 bps. Most economists are expecting a 50bps increase, lifting the total OCR to 2.5% from 2%.

Against this background, lets see how are some banking stocks doing.

Australia and New Zealand Banking Group Limited (NZX:ANZ,ASX:ANZ)

ANZ is one of the largest banks operating in New Zealand. The bank struck a deal with the Suncorp Group of Australia. According to the terms of the deal, Suncorp will be selling its banking arm to ANZ. The total transaction cost of the deal is to the tune of AU$4.9 billion. The deal is expected to give a boost to the retail and commercial business. The combination of ANZ and Suncorp is likely to make the joint entity stand third largest bank in household lending and household deposits, said the announcement on the NZX.

Suncorp has a large customer base in the home loan segment itself. The business is well established, especially in the home loan segment. According to the terms of the agreement, the CEO of Suncorp Van Clive will report to ANZs CEO. ANZ expects to complete the deal by the second half of CY2023.

On 18 July, the stock was trading flat at NZ$23.950, at the time of writing.

Heartland Group Holdings Limited (NZX:HGH)

HGH is an NZ-based financial services company of New Zealand. It operates through its banking subsidiary called Heartland Bank Limited. In June, HGH completed the acquisition of StockCo Australia. The acquisition is for a total consideration of AU$154.4 million. It is expected to expand HGHs product offerings in Australia with the help of StockCo.

The Company reported strong growth in its FY22 half-yearly results. The NPAT grew 7.8%. The interim dividend announced by the company was 5.5 cps in 1HFY22, up from 1.5 cps in 1HFY21.

On 18 July, the stock was trading up 1.49% at NZ$2.040, at the time of writing.

Westpac Banking Corporation(NZX:WBC)

Westpac is a top bank of New Zealand with headquarters in Sydney, Australia. The bank has been highly profitable due to lending activity. In the first six months of FY22, it made profits to the tune of NZ$635 partly due to the sale of its insurance arm. Its loan book was up 4% to NZ$94 billion and its mortgage lending activity was also up 7% to NZ$62.2 billion. It paid a dividend of 61 cps with 8 cps as imputed credits. The dividend was paid on 27 June.

On 18 July, the stock was trading up 2.53% to NZ$22.25, at the time of writing.

Bottom Line: Banking stocks have done major acquisitions to enhance their businesses and increase the spread and the product portfolio.

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From WBC to ANZ: Why are these NZX banking shares in news today? - Kalkine Media