Tuesday 15th April 2003
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The company signalled last year that it wanted to exit the "manufacturing" side of the banking business as it was too capital intensive.
Despite reaching an agreement to sell its loan book, which includes New Zealand residential mortgages, and Australian and New Zealand property finance loan assets, AMP plans to continue selling banking products such as mortgages.
Under the new arrangement it will sell "badged" products. For instance an customer will be able to arrange a mortgage with AMP, but it will actually be an HSBC mortgage.
The company has taken the same approach with its general insurance business, when it sold the manufacturing side of the operation to Royal & SunAlliance last year.
Under the deal announced yesterday HSBC will acquire AMP Banking's A$1.6 billion residential mortgage portfolio in New Zealand and, subject to customer consent, take on AMP Banking's A$355 million New Zealand retail deposit portfolio.
AMP Banking said it will enter into management and funding arrangements with HSBC over a further A$135 million of mortgages.
GE Commercial Finance will acquire A$1.25 billion in property finance loan assets from AMP Bank and AMP Finance in Australia and New Zealand.
AMP chief executive officer Andrew Mohl said the transfers are expected to be completed by the end of the first half of June, subject to regulatory approval and contractual obligations. The final purchase prices would depend on a number of factors, including account balances at the date of completion.
Discussions continued in relation to the proposed divestment of about A$490 million in rural property and other property finance loans retained by AMP Bank and AMP Finance.
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