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IOOF Holdings Limited update on acquisitions of ANZ P&I

Jordan Baird

Jordan Baird is the head ASR Wealth Advisers client services desk and has been with the organisation since 2017. He first started investing in his early years. While he believes that investors should leave no stone unturned he has a particular interest in trading based on broad macroeconomic trends along with specific analysis of innovative up-and-coming companies.

IOOF Holdings Limited (ASX: IFL) provides financial advice, products and services to Australians. IOOF has a market capitalization of A$2.7 billion.

What are the recent developments in IOOF activities?

On 9 December 2019, the Australian Prudential Regulation Authority (APRA) approved IOOF to hold the controlling stake in OnePath Custodians Pty Ltd and Oasis Fund Management Ltd. These approvals were the last remaining requirements in relations to the transfer of the ANZ Wealth Pension and Investment business (ANZ P&I) to IOOF.

IOOF-cover-min-800x479-1

IOOF CEO Renato Mota said: 

APRA’s approval represents an important milestone and allows for the creation of an industry leading advice-led wealth management organisation. Our recent investment into uplifting governance and client focus provides a valuable foundation which will benefit all clients and members including those from the ANZ P&I business. We look forward to continue to challenge ourselves to deliver accessible, advice-led wealth management for the benefit of all Australians.

It is also important to note that IOOF is recovering from a 52-week low in its share price of $4.19 in late 2018. The slump in IOOF’s share price in late 2018 reflected court action by APRA against IOOF executives and directors and issues arising out of the Hayne royal commission into financial services. The court action by APRA has been resolved in favour of the IOOF executives and the issues raised by APRA around conflict of interest are being resolved. In particular, APRA’s approval of IOOF acquisition of ANZ P&I is further evidence IOOF is addressing the concerns raised by APRA to APRA’s satisfaction.

What is the market reaction?

The market reaction to APRA’s announcement on IOOF activities is positive. IOOF share price is up around 2.5% and is currently trading at A$7.98. IOOF has a forward P/E ratio in the low-teens and an annual dividend yield of 4.8% (fully franked).

 


 

Disclaimer:

This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)

(“ASR”). ASR is part of Amalgamated Australian Investment Group Limited (AAIG) (ABN: 81 140 208 288 Level 13, 130 Pitt Street, Sydney NSW 2000).

This article is provided for informational purpose only and does not purport to contain all matters relevant to any particular investment or financial instrument. Any market commentary in this communication is not intended to constitute “research” as defined by applicable regulations. Whilst information published on or accessed via this website is believed to be reliable, as far as permitted by law we make no representations as to its ongoing availability, accuracy or completeness. Any quotes or prices used herein are current at the time of preparation. This document and its contents are proprietary information and products of our firm and may not be reproduced or otherwise disseminated in whole or in part without our written consent unless required to by judicial or administrative proceeding. The ultimate decision to proceed with any transaction rests solely with you. We are not acting as your advisor in relation to any information contained herein. Any projections are estimates only and may not be realised in the future.

ASR has no position in any of the stocks mentioned.

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