Eric Johnston | SMH | September 21, 2012
ANZ has offloaded its wholesale mortgage distribution business, Origin Mortgage Management Services to Sydney-based mortgage funding business Columbus Capital.
The sale, for an undisclosed amount, comes on the heels of ANZ selling its shares in global payments group Visa. Both sales have been triggered in part by the introduction of tough new banking rules that require banks to hold more levels of capital.
Origin provides funding for approximately $2.2 billion of residential mortgages through a network of mortgage managers who originate and manage the mortgages under their own brands.
“The sale is consistent with ANZ’s focus on the growth of its own branded mortgage products and its disciplined approach to capital management,” the bank said in a statement.
The financial impact of the transaction is not material, ANZ said.
ANZ will provide transitional services to Columbus Capital for up to 12 months following completion of the sale. The impact on existing borrowers funded by Origin is expected to be minimal, the bank said.
Established in 2006, Columbus Capital is a diversified non-bank financial group focused on mortgage lending and funds management.
Under new rules – known as Basel 3 – which are in the process of being rolled out, banks are required to set aside more capital for investments in associates or partnerships. By holding more capital against the investments, this will reduce the rates of return on equity generated by the partnership investment.
Earlier this week ANZ sold 3.5 million Visa shares, resulting in an after-tax profit of $224 million.
While the Visa stake was held as an equity investment, ANZ is likely to be one the hardest hit of the local banks from new banking rules that also threaten to weigh on the profitability of its string of Asian-based joint ventures.
Over the past decade, ANZ has built up a string of minority investments with a series of Asian-based partners ranging from credit cards to stakes in two Chinese-based banks.