St George shrugs offs takeover talk

St George Bank chairman Frank Conroy said yesterday that the bank would like to remain independent as long as it can, but would have to consider any takeover proposals. The bank's takeover restrictions expire on July 1st and while it has not yet received any approaches, any proposal would go to a shareholder vote. MD Gail Kelly said that St George is unlikely to be the target of a hostile takeover, as the bidder would think about the goodwill of the organisation, the staff and the customers. A hostile approach would damage some of that goodwill, Ms Kelly said, and lead to a much more unattractive proposition.

Any approach by the most likely bidder, the National Australia Bank, with just under 10 per cent of St George, would be made more difficult by recent public relations disasters such as last week's back down on proposed changes to its rewards points system. The ACCC has also indicated that it would not look kindly on a move by the NAB on St George, maintaining that the regional bank provides important competition to the Big Four in NSW, particularly in transaction accounts and small business banking. This has not stopped speculation, however, that St George may split its NSW and South Australian (BankSA) operations, plus its wealth management arm Sealcorp.

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