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Westpac to sell one financial advisory business, merge unit’s funds with Mercer Super Trust -Breaking


© Reuters. FILE PHOTO – A pedestrian walks by a Westpac Banking Corp logo outside of a central Sydney branch, Australia. November 5, 2018. REUTERS/David Gray

(Reuters) – Westpac Banking (NYSE:) Corp on Thursday announced that Advance Asset Management would be sold to Mercer Australia in a part of its continuing push to sell non-core businesses.

The country’s third-largest lender also said it would merge its unit BT’s personal and corporate pension funds with Mercer Super Trust, which is managed by Marsh & McLennan-backed Mercer Australia.

Westpac estimates that these deals will lead to an after-tax profit of A$225 million ($159.91 millions) for the rest of the financial year.

However, the bank didn’t immediately reply to Reuters’ request to disclose the terms of sale.

BT and Mercer jointly stated that their merger with Mercer Super Trust’s funds will result in a new pension fund valued at A$65 Billion.

They said that Mercer would also offer employment to BT employees supporting these funds under the terms of the agreement.

Jason Yetton, Chief Executive of Westpac Specialist Businesses said that this is an additional step towards simplifying Westpac. It also supports Westpac’s focus on New Zealand and Australia banking.

After a sector-wide regulatory inquiry in 2018, several major banks across Australia have exited other parts of the business. Westpac, for example, has sold its auto loans and life insurance units.

Rival Commonwealth Bank of Australia, (OTC) also sold its general insurer unit that year.

Westpac shares rose 1% in the early trade to A$24.10

($1 = 1.4071 Australian dollars)