ANZ's acquisition of insurer Suncorp's banking arm has been given the green light.
But it must follow strict conditions to protect national interests, the federal treasurer says.
The big-four bank had been trying for more than two years to buy out the insurer's banking business in a deal worth up to $5 billion.
It has not all been smooth sailing, with the competition watchdog rejecting the multibillion-dollar deal last year.
Treasurer Jim Chalmers has now paved the way for the deal to come to fruition, but with clear terms and conditions.
"This decision comes after careful consideration, much deliberation and consultation, and a long and thorough process," he told reporters on Friday.
"I have decided to approve this proposal, subject to strict and enforceable conditions from ANZ."
Dr Chalmers said the decision was an "on-balance call" consistent with the advice received from treasury, regulators, industry and other stakeholders.
Last year, the Australian Competition and Consumer Commission knocked back the major deal over concerns it would increase market dominance already held by the country's big four banks.
ANZ, with Suncorp's support, launched an appeal with the independent Australian Competition Tribunal.
The tribunal concluded it would not be likely to substantially lessen competition, opening the door for the deal to continue.
Considering the tribunal's conclusion, the government has agreed to the merger with strict legally binding conditions.
The main aim is to prevent Australians from losing their jobs, so ANZ must not close any of its regional bank branches or Suncorp's Queensland sites for three years.
It also requires ANZ to "make every effort" to join Australia Post banking services.
ANZ also agreed to no net job losses for three years as a result of the transaction and to "proper engagement" with employees and the Finance Sector Union.
The union says the condition allows employees time to reskill before possible branch closures.
"The treasurer has taken the time to genuinely consider the impact this major acquisition will have on workers with these positive conditions," union president Wendy Streets said.
Queensland Deputy Premier Cameron Dick welcomed the protection of jobs in the state.
"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," he said.
The bank is also subject to lending commitments which are set to benefit Queensland's future.
These include providing $15 billion towards Queensland's renewable energy projects and the 2032 Olympics preparations.
Small businesses and hydrogen projects will also benefit from $20 billion.
A clause to ease the housing crisis was also included with new home lending targets of 3000 properties and $350 million in housing-related lending.
ANZ CEO Shayne Elliott said the approval marked a significant milestone in the bank's expansion into Queensland's thriving market.
"With strong economic growth, high workforce participation and more interstate migration than any other state or territory, we're excited about the opportunities Queensland presents for ANZ and our customers," he said.
Suncorp's insurance arm is also expected to hold up commitments to the Queensland community.
It must invest in technology to better understand weather impacts, and improve the response before, during and after natural disasters.
It also included a new hub in Townsville for more jobs and First Nations employment pathways.
Suncorp Group CEO Steven Johnston affirmed the company would fulfil its insurance promises.
The acquisition is subject to three sale conditions: authorisation under Australia's competition laws, federal treasurer approval, and Queensland legislative amendments.
The first two have occurred, but the bank will have to wait for the proclamation of Queensland's legislative changes that passed parliament earlier in June.
Once that occurs, the sale is expected to close by the end of July.
