ANZ battles past divestments with solid half

ANZ’s decision to exit its wealth management and insurance businesses together with a tougher housing market has weighed on its half-year result, with the company reporting a five per cent decline in statutory profit after tax of $3.17 million.

The company maintained a fully franked dividend of 80 cents per share.

Commenting on the result, ANZ chief executive, Shayne Elliott noted that home loan demand in Australia had slowed significantly and the impact of the decision to “step back from certain segments”.

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“Home loan demand in Australia slowed significantly and this continued during the half,” he said. “While our decision to step back from certain segments compounded this impact, being more risk adverse in the current environment is prudent.”

“However, we do accept we could have done a better job implementing our new risk settings and are taking steps to improve processes.”

The banking group’s half-year results also pointed to the continuing impact of client remediation, noting that it had increased the dedicated remediation team by more than 50 per cent to improve the speed with which customers are refunded.

Commenting on the outlook for the bank, Elliott said he believed retail banking in Australia would remain under pressure for the foreseeable future with subdued credit growth, intense competition and increased compliance costs impacting earnings.

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