ANZ keen on expanding in Asia through M&A

Expects profit from non-Australia and New Zealand to rise by 30% as it aims to compete head-to-head with HSBC and StanChart.

Australia and New Zealand Banking Group, Australia's fourth biggest lender, pledged to continue its Asia expansion to sharply boost the region's contribution to profit and predicted takeover opportunities amid global uncertainty.

ANZ, which wants to become a regional Asian lender along the lines of HSBC and Standard Chartered, doubled its profit expectation from non-Australia and New Zealand business to between 25 and 30 percent by 2017, up from 14 percent in 2010.

The update to investors marks the second leg of its expansion in Asia, which began in 2007 with a target to reach 20 percent of profit by 2012 as growth and opportunities in its key Australian market diminished.

"This is consistent with their current strategy and reinforces their confidence in the region," said David Liu, head of research at ATI Asset Management, which owns ANZ shares.

"They have been disciplined so far in M&A and yet managed to grow. That should be followed as well," he said, referring to some deals that ANZ lost out on after refusing to overpay.

ANZ Chief Executive Michael Smith, the former Asian head of HSBC and the architect of ANZ's Asia push, said the new targets were all based on expansion and the bank would follow a prudent and opportunistic M&A strategy.

View the full story in Reuters.