Suncorp is nearer to becoming a “dedicated” insurer focused on Australia and New Zealand after Treasurer Jim Chalmers approved the $4.9 billion sale of its banking arm to ANZ.

The transaction is expected to complete on July 31, Suncorp and ANZ said after Dr Chalmers announced his decision on Friday.

Suncorp Group CEO Steve Johnston says the Treasurer’s announcement marks an important step.

“Following completion, Suncorp will focus on meeting the evolving needs of insurance customers and addressing increasingly complex challenges such as climate change and affordability,” he said.

“This decision also brings us another step closer to the delivery of the jobs and investment package Suncorp agreed with the Queensland government as part of the sale process, with benefits not only for Queensland but across Australia and New Zealand more broadly.”

Suncorp announced the proposed sale in July 2022, contingent on approval from the Treasurer, competition clearance and Queensland legislative amendments.

When the sale was announced, Suncorp said the divestment would allow the company to focus on its larger insurance operation, which accounts for the bulk of group revenue.

The Australian Competition and Consumer Commission blocked the deal last August, but Suncorp and ANZ successfully appealed against that decision at the Australian Competition Tribunal.

Approval from the Treasurer clears one of the last remaining hurdles. 

Dr Chalmers says his decision followed “careful consideration, much deliberation and consultation, and a long and thorough process”.

“I also took into account the unique features of this proposal, including the fact that Suncorp is one of the few remaining combined bank and insurance companies in Australia,” he said. “The proposal will allow Suncorp to focus on its insurance businesses at a time when the sector faces a range of specific challenges, including access and affordability.”

Queensland says the transaction has several conditions attached in return for its support.

One requires Suncorp to invest at least $19 million to establish a disaster response centre in Brisbane. It must also put in at least $2 million for a Suncorp regional hub in Townsville.

“When ANZ first raised the prospect of buying Suncorp, I made it crystal clear this deal could only go ahead if Queensland was the winner, and especially regional Queensland,” Deputy Premier and Treasurer Cameron Dick said.

“With federal approval granted, we will now ensure that Suncorp makes good on its commitments, strengthening the financial services sector in the state and bringing more skilled jobs here.”