ANZ has revealed that its total provisioning for customer remediation has now reached $1.2 billion at the same time as announcing a 7% decline in full-year statutory profit after tax of $5.95 billion on the back of a flat cash profit of $6.74 billion.
The board has proposed a final dividend of 80 cents per share, partially franked to 70%.
The result prompted ANZ chief executive, Shayne Elliott to refer to a “challenging year of slow economic growth, increased competition, regulatory change and global uncertainty”.
However, he said that despite the challenges, the bank had maintained focus on improving customer experience, balance sheet strength and improving its culture and capability.
Having exited its wealth management business via a major transaction with IOOF, the banking group’s outline of its customer remediation costs was significant.
It said that an additional charge of $559 million had been announced earlier this month as a result of an increase in provisions for remediation work, taking the total charge to $1.2 billion since the first half of 2017.
The ASX announcement said that the banking group recognised the impact this had on both customers and shareholders and was taking a proactive approach and conducting detail reviews across the group.
“There are more than 1,000 people working on remediation,” it said. “We returned more than $100 million to impacted customers this financial year.”
Looking over the horizon, Elliott said that while the Australian housing market was recovering, the banking group expected challenging trading conditions to continue for the foreseeable future.
He noted that increased compliance and remediation costs would need to be closely managed over the foreseeable future.