Suncorp Group

From Wikipedia, the free encyclopedia
  (Redirected from Suncorp-Metway)
Jump to: navigation, search
This article is about the Australian financial company. For the Canadian oil company, see Suncor Energy.
Suncorp Group
Type Public
Traded as ASXSUN
Industry Banking
General insurance
Wealth management
Founded 1996
Headquarters Brisbane, Australia
Area served Australia and New Zealand
Key people Ziggy Switkowski
Chairman
Patrick Snowball
CEO
Revenue Increase A$14.1 billion (2009)
Operating income Increase A$799 million (2009)
Profit Increase A$348 million (2009)
Total assets Increase A$95 billion (2009)
Employees 18,000+
Subsidiaries Suncorp Bank
Suncorp Insurance
GIO
Australian Associated Motor Insurers
Apia
Vero
Shannon's
JustCar
Website www.suncorpgroup.com.au

Suncorp Group Limited is an Australian finance, insurance, and banking corporation based in Brisbane, Queensland, Australia. It is one of Australia's largest banks (by combined lending and deposits) and its largest general insurance group,[1] formed on 1 December 1996 by the merger of Suncorp, Metway Bank and the Queensland Industry Development Corporation (QIDC).

History[edit]

State Government Insurance Office[edit]

The Government of Queensland established the State Accident Insurance Office in 1919,[2] to provide mandatory workers' compensation insurance to the state's business sector. Soon after, the government enacted new legislation creating a larger insurance body, the State Government Insurance Office (SGIO). The SGIO took over the State Accident Insurance Office, which then became the SGIO's Workers' Compensation Department. Operations were extended its operations into life insurance, general insurance and compulsory third party insurance, and over the years, superannuation, building society and finance operations were added.

In 1960, the Queensland government enacted new legislation establishing the SGIO as a separate corporation, and the group was subject to state regulatory oversight. In 1971, the SGIO took another step toward full-fledged corporate status, forming its own board of directors. At this time, the workers' compensation operations were placed under a separate board. By 1976, as SGIO's insurance operations took on a more commercial orientation, the company closed down its building society operations.

The next step toward the SGIO's move toward the private sector came in 1985, with the passage of the Suncorp Insurance and Finance Act. Under this legislation, the company dropped the SGIO name in favor of the Suncorp name. and its employees lost their status as civil servants. At the same time, Suncorp Insurance and Finance became an independent corporation, although still fully controlled by the Queensland government. By the mid 1990s, Suncorp was operating as an allfinanz group (i.e. combining banking, financial, and insurance services) with approximately $10 billion in assets.

Metway Bank[edit]

Metway Bank was established as the Metropolitan Permanent Building Society in 1959.[2] In the late 1980s, Metropolitan joined the trend among Australia's building societies to expand into full-scale banks. Metropolitan abandoned its status as a building society in 1988, reincorporated as a bank and listed its shares on the Australian Stock Exchange. Metway, as the new bank was called, then began acquiring a number of rival banks and building societies.

In 1990, Metway Bank acquired Prudential Finance Limited and, in 1992, the Household Building Society. By the mid 1990s, Metway Bank was Queensland's largest locally based bank with operations in New South Wales and Victoria, and had approximately $7.1 billion in assets.

Queensland Industry Development Corporation[edit]

QIDC evolved from the Queensland Agricultural Bank (Agbank) established in 1902, and wholly owned by the Queensland Government.[2] Initially operating primarily as a rural financier, its activities expanded to include commercial lending to small and medium sized businesses. In recognition of this, the Queensland government passed new legislation to incorporate and regulate the bank as the Queensland Industry Development Corporation, which began operations in 1986. By the mid 1990s, QIDC had total assets of approximately $3 billion.[2]

Merger as Suncorp-Metway: 1996 to 1999[edit]

The Queensland government took steps to respond to sweeping changes in Australia's financial and insurance industries in the mid 1990s, and especially the increasing convergence of the banking and insurance sectors. On 1 December 1996, the government-owned Suncorp and QIDC entities were merged into the publicly listed company Metway Bank. The new company, Suncorp-Metway, became Queensland's largest financial and insurance group, also became one of the largest in Australia, ranking fifth in the national market. By 1998, the company's combined total assets exceeded $22 billion.

The Queensland government initially controlled 68 percent of the new company, but quickly made good on its promise to sell off most of its holding within five years. In 1997, the company conducted a public offering that reduced the government's stake in Suncorp-Metway to 4 percent. One year later, the government sold the remainder of its shares in the company. In 1999, Suncorp-Metway completed the integration of the Metway, Suncorp and QIDC operations, and launched a single unified brand, Suncorp-Metway. As part of this process, the company also trimmed its branch network, shutting down a number of redundant branches.

Further conglomeration: 2000 to 2006[edit]

The completion of its integration phase enabled Suncorp-Metway to begin putting into place a new strategy for the future. The company sought to launch itself on a truly national scale, replacing its allfinanz model with a new financial conglomerate strategy. As part of that effort, the company sought to expand its mix of products and services, particularly in its more profitable insurance division. In 2001, the company made its first acquisition, of the general insurance operations of AMP, known as GIO General Ltd. That purchase enabled Suncorp-Metway to become the second largest general insurance group in Australia, with more than $2 billion in premiums per year.

The company next carried out another rebranding exercise, adopting the Suncorp name for all of its operations in Queensland, and for its banking and wealth management operations outside of the state. The company's insurance business, excluding Queensland, took on the GIO brand. This rebranding was completed in 2002.

Suncorp continued to seek to build up its insurance business into the middle of the decade. The company acquired 50 percent of Queensland-based automobile club insurance RAA, a joint venture originally formed between AMP and RACQ. Suncorp bought out AMP's share of the joint venture in 2002. In 2004, the company boosted its insurance operations outside of Queensland with the purchase of Tasmania's RACT Insurance.

Promina acquisition: 2007[edit]

Suncorp then began preparations for a still larger acquisition of insurance giant Promina Group Limited. By early 2007, the two companies had agreed to terms of a merger, which, valued at AUD 7.9 billion ($5.9 billion), represented one of the largest completed in Australia's financial services sector since the beginning of the new century.[3]

Promina had formerly been the Australian wing of UK-based insurance giant Royal and Sun Alliance, until it was spun off as a separate, publicly listed company in 2003.[4] The merger transformed Suncorp into a true giant in the Australia and New Zealand market, doubling its total assets to nearly AUD 85 billion ($65 billion).

Recent events[edit]

During a retail banking review in 2007, Suncorp determined its credit card portfolio was a non-core asset and entered into talks to sell its 100,000 card/$230 million credit-card portfolio to Citibank.[5] Citibank now handles the operational aspects of credit whilst the Suncorp brand remains on the cards and Suncorp continues to provide customer interaction.[6]

As of 2007, Suncorp had assets of over A$95 billion,[2] over 9 million customers,[2] and over 16,000 staff.[7] Suncorp operated 232 retail and business banking outlets, predominantly in Queensland. GIO operated 34 agencies in NSW and Victoria. An additional 157 retail branches and services centres were added with the Promina acquisition.[2]

In June 2013, Goldman Sachs’s Special Situations Group, the proprietary investment unit of the investment bank, purchased some of Suncorp Group Ltd.’s loans for about US$863 million.[8] In the summer of 2013 as European lenders were divesting their loans portfolios, in Australia, hedge funds and investment banks were buying them.[8] In 2013, distressed-debt investors, seeking investment opportunities in Asia, particularly in Australia, acquired discounted bonds or bank loans of companies' facing distressed debt, with the potential of profitable returns if the companies' performance or their debt-linked assets improves. In 2013 Australia was one of the biggest markets for distressed-debt investors in Asia.[8]

Suncorp has been granted a MySuper authority, enabling it to continue to receive default superannuation contribution from 1 Jan 2014.

Suncorp Business Services appointed its new CEO, Matt Pancino, on the 13th June 2014. Matt formerly worked as the Chief Information Officer for the group.[9]

Business interests[edit]

Suncorp covers nearly all areas in wealth and banking, including life insurance, general insurance, commercial insurance, Compulsory Third Party (CTP), banking, finance, agricultural banking and business banking, the notable exception being health insurance. It is the largest banking and insurance corporation headquartered in Brisbane.[1]

Suncorp is the parent company of insurance company GIO, which is mainly used as a general insurance company representing Suncorp outside Queensland, offering similar products to the Suncorp branded insurance product in Queensland.

Suncorp also owns the AAMI, Apia, Just Car Insurance, Shannons, InsureMyRide, Vero, Terri Scheer, Bingle, CIL, Asteron and Tyndall insurance brands in Australia, and Vero, Asteron, Guardian Trust, Tyndall, Vero Marine, Vero Liability, AA Insurance, SIS, CMV/AXIOM, Mariner, Comprehensive Travel Insurance and Autosure brands in New Zealand. These assets were acquired with the Promina Group in 2007.

Suncorp Bank[edit]

Suncorp Bank brand

On 19 April 2009, Suncorp announced a re-branding of the banking arm of the company to Suncorp Bank. The reason behind the re-branding is to give the company a view[citation needed] that Suncorp is a bank with an insurance arm, not an insurance company with a banking division. This is also being done to try to aid the bank's expansion into Western Australia, where Suncorp is not known for its banking capabilities, with the focus previously being on its insurance strengths.

Joint ventures[edit]

Suncorp acquired insurance joint ventures with motoring clubs RACQ and RAA in 2001, but chose to divest them in 2010. RACT Insurance in Tasmania continues to be 100% owned by Suncorp.

Suncorp Stadium[edit]

Main article: Suncorp Stadium

Suncorp holds the naming rights of Lang Park, currently branded as Suncorp Stadium. It is a rectangular sporting stadium located in the Brisbane suburb of Milton, and is the home of the Brisbane Broncos, Queensland Reds and Brisbane Roar FC.

References[edit]

  1. ^ a b "Group Overview". Retrieved 2007-02-05. 
  2. ^ a b c d e f g "history of Suncorp". Retrieved 2007-02-05. 
  3. ^ "Promina shareholders approve $8b Suncorp merger". The Sydney Morning Herald. 5 March 2007. Archived from the original on 2014-06-15. Retrieved 2014-06-16. 
  4. ^ Cave, Andrew (1 April 2003). "Royal Sun floats off Promina". The Telegraph (London). Archived from the original on 2014-06-15. Retrieved 2014-06-15. 
  5. ^ "Suncorp to transfer $230m credit card portfolio to Citi". The Sydney Morning Herald. 8 February 2008. Retrieved 2008-10-06. 
  6. ^ "Suncorp and Citibank Sign Credit Card Deal". Retrieved 2008-05-05. 
  7. ^ John Mulcahy (2006-11-16). Chief Executive Officer’s presentation to Morgan Stanley Asia Pacific Summit, Singapore (PDF). Suncorp-Metway Limited. Retrieved 2007-02-05. 
  8. ^ a b c "Distressed-Debt Investors Eye Asia". Wall Street Journal. 7 August 2013. Retrieved 8 August 2013. 
  9. ^ http://www.suncorpgroup.com.au/announcements-pdf/539102

External links[edit]