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BoQ buys Investec unit

Bank of Queensland is buying the professional finance and leasing arm of South African-owned Investec’s Australian unit for A$440 million, aiming to boost credit quality and diversify outside its home state. BoQ said the acquisition will give it Investec’s A$2.4 billion loan portfolio, grow its commercial loan book by 38% and add A$38 million in net earnings in the first year excluding acquisition costs. Australia’s banks are focusing on improving their credit quality to buffer against sluggish business spending as a mining slowdown curbs investment plans. BoQ has been keen to cut bad debt since its exposure to a weak economy in Queensland state contributed to an annual loss in 2012. BoQ, which has most of its business in Queensland but has operations in most Australian states, bid against regional rival Bendigo and Adelaide Bank and larger Australia and New Zealand Banking Group for the asset. Investec, a South African investment bank and asset manager, said its struggling Australian arm had dampened an improved performance in Africa and Britain.

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