ANZ strategy generates 12% profit lift

ANZ’s strategy of disposing of assets, including elements of its wealth business, appears to be paying dividends with the big banking group announcing a 12 per cent increase in statutory net profit after tax to $6.41 billion for the full-year to 30 September.

Announcing the result to the Australian Securities Exchange (ASX) today the bank said it “demonstrates the emerging benefits for customers and shareholders arising from ANZ’s strategy to create a simpler, better capitalised and better-balanced bank”.

The result saw the directors declare a final dividend of 80 cents per share, fully franked.

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The full-year results announcement comes in the wake of ANZ having this month announced the sale of its OnePath Pensions and Investments and Aligned Dealer Group businesses to IOOF and with its insurance business still on the block for possible sale.

The company’s divisional results served to underline the reasons for the ANZ strategy, with the wealth division reporting a 27 per cent decline in cash profit with insurance being a substantial driver for that result down 19 per cent.

Commenting on the overall company result, ANZ chief executive, Shayne Elliott described it as “good” and demonstrating “further progress in becoming a better balanced, better capitalised, more efficient bank”.

He said ANZ had made difficult calls and the new shape of ANZ was now emerging, with the company having shifted its capital base to give greater emphasis to the retail and commercial businesses in Australia and New Zealand which now account for 53 per cent of its capital, up from 44 per cent two years’ ago.

“Today we are at the mid-point of executing a multi-year transformation of ANZ,” Elliott said.

Looking over the horizon, the ANZ CEO said the bank expected 2018 to bring another year of constrained revenue growth as a result of intense competition and the effect of regulation including the full-year impact of the Australian bank tax.

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