HBOS has been promising for some time that it will invigorate its presence in Australia. Hard on the heels of a 46-branch expansion drive in Ireland — its other key international market — the UK’s fourth-largest lender finally delivered on that promise today.
Over the next three to four years, HBOS plans to spend £160 million building a 250-strong branch network in Australia that will give the country’s big four — National Australia Bank, Westpac, Commonwealth Bank and ANZ — a run for their money.
BankWest, HBOS’s Perth-based subsidiary, has about 5 per cent of the Australian high street, so has plenty of scope to grow.
This is not a transforming move for HBOS, which will take the same, discounting approach to selling financial products that it has pursued in the UK over the past five years.
But while the investment, and the tactics, are not revolutionary, the timing is more intriguing. Intense competition has made HBOS’s home market considerably tougher in recent months. During the first quarter, its share of net new mortgage lending slumped from 17 per cent to just 8 per cent. Meanwhile, investors continue to fret over its exposure to leveraged buyout lending.
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For now, its long-awaited Australian adventure will provide a much-needed diversion