Moody's Ratings has downgraded the long-term issuer ratings of Suncorp Group Limited to A3 from A2, following the sale of its banking subsidiary to ANZ yesterday. The rating outlook is stable. 

Suncorp Group 's issuer rating is now aligned with Moody’s methodological standard for insurance groups subject to group regulation, which is two-notches below the insurance financial strength rating of its main operating subsidiary, AAI Limited (IFSR A1 stable).

Net proceeds to Suncorp from the sale of the bank “are expected to be around $4.1 billion” Suncorp told shareholders yesterday. 

Suncorp chair Christine McLoughlin said the board “remains committed to returning to shareholders proceeds that are in excess of the needs of the business. 

“Accordingly, we currently expect the majority of net proceeds will be returned to shareholders around the first quarter of the 2025 calendar year, with timing dependent on receipt of a ruling from the Australian Tax Office and approval from the Australian Prudential Regulation Authority.  

“We expect the return of proceeds will consist of two components: the payment of a special dividend and a cash payment (capital return) for a portion of your shareholding.”

ANZ has acquired $97 billion in assets from the takeover of Suncorp Bank, as at June 2024, based on APRA’s monthly banking statistics released yesterday.

This includes a home loan book of $53 billion and a household deposit book of $35 billion.

Adam Bennett, Suncorp’s group executive technology and pperations, will assume responsibility for the delivery of the Transitional Services Agreements with ANZ to provide a range of services to Suncorp Bank, the majority of which are planned to be exited within two years and the remainder exited no later than five years.