Westpac, ANZ in the running for Lloyds’ Australian units

According to sources close to the matter, Westpac  (ASX: WBC) and ANZ (ASX: ANZ) are amongst the shortlisted bidders for Lloyds Banking Group’s Australian asset-finance and commercial lending units.

It is estimated that Lloyds could reap in excess of AU$1 billion for the sale, which the bank wishes to finalise in order to strengthen its balance sheet and cut costs. Reportedly, the bank is aiming to reduce its international branches from 14 countries to less than 10 by next year.

The acquisition of Lloyds’ assets would provide the successful bidder with growth prospects in a market with limited growth opportunities. Furthermore, the bank’s assets are appealing as they are amongst the last sizable domestic acquisitions that would not draw attention from the Australian Competition and Consumer Commission.

Last week, The Australian Financial Review revealed that Commonwealth Bank (ASX: CBA) had turned its back on the business. Whilst other banks are in the running to take on Lloyds’ assets, it seems likely that it would be Westpac or ANZ due to their ability to fund the portfolios. It has been speculated that National Australia Bank (ASX: NAB) is also keen on the acquisition.

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned in this article.

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