<span id="midArticle_start"/>(Adds analyst comment, industry context)
<span id="midArticle_0"/>By Byron Kaye
<span id="midArticle_1"/> May 4 (Reuters) - Australia and New Zealand BankingGroup said it plans to sell its car and equipmentfinance business, which has $6.5 billion worth of outstandingcustomer loans, in a bid to cut its capital requirements undertough new rules.
<span id="midArticle_2"/>ANZ Australia CEO Mark Whelan did not specify an expectedprice but local media had said the business may fetch about A$2billion ($1.57 billion). The sale is part of a broaderrestructuring aimed at ensuring the bank uses its capitalefficiently, Whelan said in a statement.
<span id="midArticle_3"/>The bank, Australia's third-largest lender by marketcapitalisation was widely expected to sell the unit, Esanda, aspart of an industry-wide reshuffle of financial loan books tocomply with rules aimed at increasing the relative amount ofcash lenders keep in reserve.
<span id="midArticle_4"/>The announcement also comes a day before the bank is due toreport half-yearly earnings which are expected to show profitmargins squeezed by a slowing economy and other headwinds facingbanks including falling commodity prices.
<span id="midArticle_5"/>"They're planning to have their capital requirements reducedas a consequence of selling the business," said BBY analystBrett Le Mesurier. "They wouldn't need to raise capital becausethey wouldn't need as much capital."
<span id="midArticle_6"/>In March, the Australian arm of GE Capital sold itsconsumer finance business to private equity firm KKR & Co LP for A$8.2 billion.
<span id="midArticle_7"/>ANZ said it will send an information memorandum to potentialbidders later this month. It added that the sale will notinclude the ANZ commercial broker, commercial asset finance ordirect-to-consumer asset finance businesses.
<span id="midArticle_8"/>ANZ shares closed down 3 percent in a firmer overall marketafter rival Westpac Banking Corp missed analystforecasts with its interim profit result, triggering a selldownacross most bank stocks.
<span id="midArticle_9"/>($1 = 1.2758 Australian dollars)($1 = 1.2765 Australian dollars) (Reporting by Byron Kaye and Swati Pandey; Editing by MiralFahmy)
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<span id="midArticle_0"/>By Byron Kaye
<span id="midArticle_1"/> May 4 (Reuters) - Australia and New Zealand BankingGroup said it plans to sell its car and equipmentfinance business, which has $6.5 billion worth of outstandingcustomer loans, in a bid to cut its capital requirements undertough new rules.
<span id="midArticle_2"/>ANZ Australia CEO Mark Whelan did not specify an expectedprice but local media had said the business may fetch about A$2billion ($1.57 billion). The sale is part of a broaderrestructuring aimed at ensuring the bank uses its capitalefficiently, Whelan said in a statement.
<span id="midArticle_3"/>The bank, Australia's third-largest lender by marketcapitalisation was widely expected to sell the unit, Esanda, aspart of an industry-wide reshuffle of financial loan books tocomply with rules aimed at increasing the relative amount ofcash lenders keep in reserve.
<span id="midArticle_4"/>The announcement also comes a day before the bank is due toreport half-yearly earnings which are expected to show profitmargins squeezed by a slowing economy and other headwinds facingbanks including falling commodity prices.
<span id="midArticle_5"/>"They're planning to have their capital requirements reducedas a consequence of selling the business," said BBY analystBrett Le Mesurier. "They wouldn't need to raise capital becausethey wouldn't need as much capital."
<span id="midArticle_6"/>In March, the Australian arm of GE Capital sold itsconsumer finance business to private equity firm KKR & Co LP for A$8.2 billion.
<span id="midArticle_7"/>ANZ said it will send an information memorandum to potentialbidders later this month. It added that the sale will notinclude the ANZ commercial broker, commercial asset finance ordirect-to-consumer asset finance businesses.
<span id="midArticle_8"/>ANZ shares closed down 3 percent in a firmer overall marketafter rival Westpac Banking Corp missed analystforecasts with its interim profit result, triggering a selldownacross most bank stocks.
<span id="midArticle_9"/>($1 = 1.2758 Australian dollars)($1 = 1.2765 Australian dollars) (Reporting by Byron Kaye and Swati Pandey; Editing by MiralFahmy)
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