NAB's AXA AP acquisition not risk free
National Australia Bank (NAB) has earned a positive assessment from global ratings house Fitch Ratings, along with a warning that its proposed acquisition of AXA Asia Pacific is not without risk.
The Fitch Ratings assessment of NAB pointed to the fact that the banking group had undertaken a number of acquisitions in both the banking and wealth management areas in Australia during the global financial crisis, which had generally been modest in size and with integration appearing to be proceeding well.
However, looking at the NAB bid for AXA Asia Pacific, the ratings house noted that while the banking group was working to address the concerns raised by the Australian Competition and Consumer Commission, it would represent “a relatively large acquisition, presenting some integration risk”.
“However, the impact on NAB’s capital position appears manageable and it could provide benefits to NAB’s already robust wealth management operations,” the assessment said.
Fitch said it viewed NAB’s wealth management operations positively due to the relatively low-risk, low-capital nature of the businesses and the strong potential for growth given Australia’s compulsory pension regime.
AUTHOR
Mike Taylor
Recommended for you
With wealth management M&A appetite only growing stronger, Business Health has outlined the major considerations for buyers and sellers to prevent unintended misalignment between the parties.
Industry body SIAA has said the falling number of financial advisers in Australia is a key issue impacting the attractiveness and investor participation of both public and private markets.
As advisers risk losing two-thirds of FUA during the $3.5 trillion wealth transfer, two co-founders underscore why fostering trust with the next generation is vital to retaining intergenerational wealth.
As advisers seek greater insights into FSCP determinations, what are the various options considered by the panel and can a decision be appealed?
