BNK ENTERS AGREEMENT TO SELL FINSURE FOR $151 MILLION

BNK Banking Corporation Limited (ASX:BBC) today announced it has entered into a Share Sale Agreement (SSA) with MA Financial Group Limited (ASX:MAF) under which MAF will acquire 100% of BNK's subsidiary, Finsure Holding Pty Ltd (Finsure) and related aggregation division subsidiaries for consideration of $151.6 million in cash ("Proposed Transaction").

Completion of the proposed transaction is subject to the receipt of regulatory approval and is expected to occur in the first half of 2022.

BNK’s Chairman, Mr Don Koch, said the proposed transaction represented a positive outcome for BNK stakeholders.

“The Company previously announced a strategic review to consider all options to maximise value for BNK shareholders.  As part of that review, the Board has carefully assessed a range of alternatives, including expressions of interest from a number of parties regarding BNK’s asset portfolio.

“After a detailed assessment, the Board believes the sale of Finsure to MAF represents a compelling outcome for all BNK stakeholders, including shareholders, our people and customers.

"The sale price of $151.6 million cash is an attractive valuation and will deliver significant value to BNK shareholders.  The sale price represents a 66% premium to the undisturbed market capitalisation of the Group prior to announcement of the strategic review on 21 September 2021.

“Finsure is a top 4 mortgage broking aggregator with over 2,000 brokers and a national distribution footprint with a market leading technology suite.  While Finsure has been growing strongly, the opportunity to be part of MAF, a larger and more diversified financial services group, will accelerate Finsure’s ability to grow its presence in the Australian financial services market.

“MAF is a strong financial entity specialising in asset management, lending, corporate advisory and equities, with a market capitalisation of around $1.4 billion and over $6 billion in assets under management.

“Following the sale of Finsure, BNK will be a strongly capitalised digital bank with a clear and focused strategy to leverage recent initiatives to strengthen our competitive position.

“We will continue to assess options in respect of BNK as part of the ongoing strategic review,” Mr Koch said.

Finsure CEO, John Kolenda, added his support to the proposed transaction.

“The strong financial position of MAF, provides Finsure with exciting opportunities to accelerate our growth agenda and provide additional value to our broker network.

“Finsure is uniquely positioned as a scalable, technology-enabled platform with a differentiated service proposition to become one of the most powerful pieces of financial infrastructure in the Australian residential mortgage market. MAF can support Finsure in this journey through its access to capital, credit & lending capabilities and technology expertise,” Mr Kolenda said.

Proceeds from the sale are expected to be $151.6 million subject to adjustments before costs and taxes.

As part of its ongoing strategic review, the Board of BNK is evaluating a range of capital management options to utilise these proceeds efficiently. It is currently anticipated that a distribution in respect of a material portion of these proceeds will be made to shareholders.

A further announcement on capital management will be made in due course.<