In news on Australian stocks, ANZ Group Holding Limited (AU:ANZ) announced that it is offloading a 16.5% stake in Malaysia-based AMMB Holdings Bhd (AmBank). The transaction, valued at $443.7 million, is in line with ANZ’s strategy to streamline the bank and reduce its stake in low-return businesses. ANZ shares traded up by 1.01% in today’s session.
ANZ ranks among the top four banks in Australia, with operations in around 30 markets.
Details About the Stake Sale
The stake sale was conducted via a block trade at a price of 3.85 Malaysian ringgit per share, which is 8.35% below AmBank’s closing price on Tuesday.
Following the completion of the sale, slated for March 8, ANZ’s ownership in AmBank will reduce from 21.7% to 5.2%. The proceeds from the sale are projected to boost ANZ’s CET1 (common equity tier) ratio by approximately 16 basis points but the transaction is not expected to have any significant impact on the bank’s profit. Last month, ANZ reported a CET1 ratio of 13.1% in its first-quarter results for FY24. This was down from 13.3% in the previous quarter.
Additionally, the bank intends to use the proceeds from this sale in its capital management strategies, thereby enhancing the likelihood of higher dividends in the future.
Is ANZ a Good Buy Now?
According to TipRanks’ analyst consensus, ANZ stock has received a Moderate Buy rating based on five Buy and five Hold recommendations. The ANZ share price forecast is AU$27.49, which is almost 5% below the current trading price.
