Big banks more likely to eat each other

Outgoing chief executive at the ANZ Bank says that a merger between the big four, or a tie-up with an international bank, is more likely than a takeover of St George. While such a move would require dismantling of the four pillars policy, or regulatory approval for foreign investment, Mr McFarlane still believes that these are the more likely options, as any major bank acquisition of a regional bank would be earnings dilutive. Mr McFarlane says that a big bank merger would take the same amount of time as a smaller bank merger but would be 7 or 8 per cent accretive, therefore a much more attractive option.

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