Acquisition

Paragon Group Of Companies PLC
17 October 2000


                      Paragon Acquires Colonial Finance

The Paragon Group of Companies PLC ('Paragon') has acquired the entire
share  capital  of  Colonial  Finance  (UK)  Limited  ('Colonial  Finance'),
formerly  the  UK  consumer  finance operation  of  Colonial  Limited,  from
Colonial  International Holdings Pty Limited, a subsidiary  of  Commonwealth
Bank of Australia.

Colonial Finance is a provider of retail credit business and personal loans.
As at 30 September 2000, it had £174.1 million of loan balances with 102,000
customers.   The  retail credit loans are sourced from the company's  strong
relationships with over 1,000 customers at 1,600 outlets with  a  particular
focus  on  small  and  medium  sized furniture stores.   The  personal  loan
business   is   primarily  sourced  from  the  company's  affinity   partner
relationships.   Virtually  all of the company's operations,  including  its
loan administration, are outsourced to third parties.

The purchase consideration is to be determined by completion accounts and is
expected  to  be  approximately £2 million payable in cash,  which  will  be
financed  by  Paragon's own financial resources.  Immediately following  the
acquisition the loan assets of Colonial Finance were refinanced by a funding
warehouse facility.  This facility will also be available to fund Colonial's
new business originations.

The   statutory  financial  statements  of  Colonial  Finance  reported  net
liabilities of £462,000 at 31 December 1999 at a loss of £1.4 million  after
taxation  for  the year ended.  Following a financial restructuring,  it  is
estimated  that  the value of the net assets of Colonial  Finance  currently
stand at £16.4 million.

The  acquisition of Colonial Finance brings forward Paragon's planned  entry
into  the  retail credit market and gives immediate access to an experienced
team  and  a  significant new distribution channel.   The  personal  finance
business  will  be  integrated  with Paragon's  existing  unsecured  lending
operation.

Commenting on the acquisition, Nigel Terrington, Chief Executive of Paragon,
said:

'This is a further important step in our strategy of diversification into  a
broader  range of consumer finance markets.  The acquisition not only  gives
Paragon   a  profitable  new  line  of  business,  but  also  valuable   new
distribution outlets.  Additionally it brings us over 100,000 new customers,
which  virtually  doubles  the  size of our  existing  customer  base.   The
acquisition  exploits  Paragon's core skills as  a  niche  lender  accessing
distribution  via  intermediaries  and funding  through  the  securitisation
markets.   We would expect the acquisition to be earnings enhancing  in  the
current financial year.'


For further information, please contact:

The Paragon Group of Companies PLC
Nigel Terrington, Chief Executive
Nick Keen, Finance Director
Tel : [phone]

The Wriglesworth Consultancy
John Wriglesworth
Tel : [phone]
Mobile : [phone]


NOTES TO EDITORS

The Paragon Group of Companies PLC
The  Paragon  Group  of Companies PLC is one of the UK's largest  specialist
lenders  offering first mortgages, unsecured and secured loans, and  vehicle
finance.  The Group has over £1.5 billion of assets under management and has
a full public listing on the UK stock exchange.

The Colonial Group
The  Colonial Group is an international financial services group, the parent
of  which,  Commonwealth Bank of Australia, is listed on the Australian  and
New Zealand stock exchanges.