BOQ acquires ME Bank in massive $1.3 billion deal

Bank of Queensland announced it will be acquiring industry super fund-owned lender ME Bank for $1.3 billion, in a move key stakeholders have called “a permanent shift for the better in the Australian banking landscape.”

It comes following a tense bidding war over the weekend which saw BOQ beat out both ANZ Banking Group and Bendigo Bank for the keys to the challenger bank, which made a profit of $80.85 million last financial year.

The takeover will be funded by an underwritten capital raising of $1.35 billion, and is expected to be completed by the end of the 2021 financial year, pending regulatory approval.

With the addition of ME Bank, BOQ Group’s pro forma total assets will now come to $88 billion and deposits now total more than $56 billion.

Chairman of ME Bank, James Evans said the decision was unanimously supported by the bank’s shareholders, and was made with the best interests of both customers and employees in mind.

“This agreement brings together two culturally aligned organisations to form what will be an enhanced and influential banking alternative for customers,” he said.

“The combined group will be able to offer a wider network of service options, deeper resources, and the added reassurance that comes with a larger banking organisation.”

BOQ managing director and chief executive George Frazis said the combination of the two businesses is a “defining” moment in BOQ’s ongoing transformation. 

“Critically, ME Bank delivers material scale, broadly doubles our Retail bank, and provides geographic diversification. The ME Bank brand is also a great fit with the BOQ and Virgin Money brands, creating customer-centric alternatives in Australia,” he said.

“It is an exciting day to see two strategically and culturally-aligned businesses come together and we look forward to continuing to build ME Bank’s strong brand, accelerate growth and create new opportunities for our people and the Group.

“We are on track with our strategic transformation and we anticipate that the combination of the two businesses will enable us to accelerate our digital strategy towards a cloud based common digital Retail bank technology platform.”

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