The Australian Competition and Consumer Commission (ACCC) has given Westpac (ASX: WBC) the green light to acquire Lloyds Banking Group's Australian assets for $1.45 billion.
The deal, which marked the bank's largest acquisition since 2008 when it purchased St George, included a portfolio of loans as well as Lloyds' motor vehicle leasing business, Capital Finance. As reported by The Sydney Morning Herald, the amount of car loans that will be realised by Westpac from the deal will be around $3.9 billion.
However, given that Westpac's St George already controlled 25% of the leasing finance market, the deal was subject to a review by the ACCC to ensure that it would not affect competition levels in the market.
After having looked at the degree of competition provided by financiers from Toyota, Nissan, ANZ (ASX: ANZ) and Macquarie Group (ASX: MQG), the ACCC determined that the acquisition would not significantly lessen the level of competition in the market for car loans.
Foolish takeaway
The acquisition of Lloyds' Australian assets received significant attention from some of Australia's largest banks including NAB (ASX: NAB), Commonwealth Bank (ASX: CBA), ANZ and Macquarie Group. The deal could help drive future growth for Westpac in an otherwise slow-growth market.
