ANZ said the transition will occur over the next three months, and involved the transfer of $13 billion worth of assets from the Esanda entity to ANZ.
"Esanda has built a broad base of loyal debenture customers,'' ANZ's managing director of Esanda Moray McDonald said.
"Our customers are naturally attracted to the Government guarantee, and today's change delivers them the benefit of the Government guarantee when their debenture matures.''
The Federal Government last year launched the Australian Government Guarantee Scheme for Large Deposits and Wholesale Funding to underpin confidence in bank deposits and help banks raise funds in wholesales lending markets with the backing of the Commonwealth's triple A credit rating.
ANZ said making Esanda a division of the bank will not be material to the bank but will allow Esanda's customers to benefit from the changes in the marketplace in recent months.
Esanda mostly lends to small and medium size businesses, automotive retailers, car and equipment buyers.
ANZ under the change, all existing Esanda debentures will be maintained, but no new ones will be issued from today.
ANZ will also launch the Esanda Term Deposit, supported by the federal government's guarantee on bank deposits.
"Esanda has benefited from being part of the ANZ Group for over 50 years,'' Mr McDonald said.
"Ours is a strongly performing business and our brand and business operations will not change.
"As overseas financiers have withdrawn from the Australian market we have welcomed many new, quality auto retailers to Esanda and have begun an exciting new partnership with Subaru.''
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