Treasurer Josh Frydenberg and the prudential regulator and are some of the last obstacles in the way of NAB’s $220 million takeover of neobank 86 400, which the competition watchdog now says it will approve.

Following a month of consultation with the industry, Australian Competition and Consumer Commission chairman Rod Sims said on Tuesday the deal would not significantly reduce competition in the banking market, despite his prior concern that large banks could “pick off” emerging rivals.