SD-based Great Western Bancorp files for initial public offering
By Soyoung Kim and Mike Stone
NEW YORK — Great Western Bancorp Inc., the U.S. subsidiary of National Australia Bank Ltd, filed with U.S. regulators on Thursday for an initial public offering.
Reuters reported earlier on Thursday that NAB, Australia’s No. 4 lender by market value, had tapped Deutsche Bank and Bank of America Corp. to lead the U.S. IPO of its Sioux Falls-based banking unit.
“As we continue to strengthen our core Australian and New Zealand franchises, we’ve made the decision that now is the right time for a staged sale of Great Western Bank,” NAB Group Chief Executive Andrew Thorburn said.
NAB acquired regional lender Great Western in 2008 for just below $1 billion to get more involved in funding agribusiness in the United States, but the operation lacks the scale of larger competitors in the western states where it operates.
Now the flagship of the Australian bank’s U.S. banking operations, Great Western has about 200 locations in several states, including Arizona and Colorado, and has assets in excess of $8 billion, according to its website.
Australia’s four biggest banks — NAB, Australia and New Zealand Banking Group Ltd., Commonwealth Bank of Australia and Westpac Banking Corp. — are investor favorites for their lofty dividends and record profits.
But NAB shares have underperformed its rivals, partly due to problems at its UK businesses, Yorkshire Bank and Clydesdale Bank.
The move to list Great Western is the first major step since Thorburn became NAB’s group chief executive on Aug. 1. Analysts suggest that he will focus on turning around the struggling U.K. operations.
Great Western will join much larger lender Citizens Financial Group Inc., the U.S. unit of Royal Bank of Scotland Group, in the queue of banking IPOs. Citizens filed with U.S. regulators for a proposed offering in May.
Several financial institutions have gone public this year, including Ally Financial Inc., investor Wilbur Ross-backed Talmer Bancorp Inc. and Texas-based Green Bancorp Inc.
NAB said in a separate release that it plans to sell a minority stake in Great Western through the IPO, but could offload 100 percent of its ownership over time.