ANZ Bank’s profit in­crease

The Pak Banker - - Front Page -


Aus­tralia and New Zealand Bank (ANZ) to­day an­nounced a statu­tory profit1 af­ter tax of $5.7 bil­lion and an un­der­ly­ing profit2 of $6.0 bil­lion for the fi­nan­cial year ended 30 Septem­ber 2012, both up 6% over the prior year (YOY). The pro­posed fi­nal div­i­dend of 79 cents per share (cps) fully franked is 4% higher YOY. The to­tal div­i­dend for 2012 is $1.45 per share.

Group Bal­ance Sheet and Per­for­mance High­lights3; Profit be­fore pro­vi­sions (PBP) in­creased 5% YOY (4% HOH) re­flect­ing Group-wide pro­duc­tiv­ity gains, im­proved per­for­mance from the Aus­tralia Division in the sec­ond half, early ben­e­fits from the New Zealand sim­pli­fi­ca­tion pro­gram, growth in In­ter­na­tional and In­sti­tu­tional Bank­ing par- tic­u­larly in Asia and an im­prov­ing con­tri­bu­tion from the Global Wealth and Pri­vate Bank­ing Division.

The Group in­vested $1.3 bil­lion in tar­geted growth ini­tia­tives in 2012 with pro­duc­tiv­ity im­prove­ments driv­ing flat ex­penses HOH and pos­i­tive rev­enue/cost jaws YOY and HOH. ANZ con­tin­ues to in­crease the diver­sity of its rev­enue base with 21% of Group rev­enues de­rived out­side of Aus­tralia and New Zealand dur­ing 2012. Global Mar­kets rev­enue in­creased 14% to $1.9 bil­lion with cus­tomer

sales in­come up 10% to rep­re­sent 61% of to­tal in­come.

Net in­ter­est mar­gin ex­clud­ing Global Mar­kets de­clined 3 ba­sis points (bps) from the end of the first half4; re­flect­ing in­creased fund­ing costs in par­tic­u­lar from de­posits, as well as as­set pric­ing pres­sure in In­sti­tu­tional. De­posits grew 12% with lend­ing up 8% (FX ad­justed). ANZ con­tin­ues to have the low­est whole­sale fund­ing re­quire­ment of its do­mes­tic peers. Cus­tomer fund­ing com­prises 61% of to­tal fund­ing.

The Group is well po­si­tioned for the im­ple­men­ta­tion of Basel 3 from Jan­uary 2013. As at 30 Septem­ber 2012, ANZ’s Com­mon Eq­uity Tier 1 ra­tio (CET1) was 10.0% on a Basel 3 har­monised ba­sis5 or 8.0% un­der the Aus­tralian Pru­den­tial Reg­u­la­tion Author­ity’s (APRA) Basel 3 stan­dards. Re­turn on Eq­uity re­duced by 60 bps to 15.6%. Ben­e­fits from the Group’s cap­i­tal ef­fi­ciency fo­cus were some­what off­set by higher reg­u­la­tory cap­i­tal hold­ings and re­duced earn­ings on cap­i­tal in a lower in­ter­est rate.

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