AUSTRALIA'S SUNCORP TARGETS SYNERGIES OF US$291 MLN WITH PROMINA.

SYDNEY, Feb 1 Asia Pulse - Suncorp-Metway Ltd (ASX:SUN) says it will extract higher synergies from its A$7.9 billion (US$7 billion) merger with general insurer Promina Group, but that claims related to storms and floods will impact its insurance margins in fiscal year 2008.

The banking and insurance group says it's on track to generate annualised synergies of A$325 million (US$291 million), up A$100 million from its pre-merger estimate.

Chief executive John Mulcahy said he is delighted by the progress being made to integrate the two companies.

"We have put in place a robust and disciplined integration plan that will ensure our integration targets will be delivered on time," he said.

"The processes and controls for quantifying synergy targets and the structure of the integration governance program have been independently assessed by KPMG."

Suncorp will incur one-off implementation costs of A$375 million as a result of the merger, up A$20 million from a pre-merger estimate of A$355 million.

The synergy upgrade follows a six-month process during which more than 400 employees from Suncorp and Promina businesses worked to shape the new organisation.