BUSINESS ANZ profit slips in tough Australian banking climate

BUSINESS

ANZ profit slips in tough Australian banking climate

AFP

06:28, November 01, 2018

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The Australia and New Zealand Banking Group said its cash profit on an ongoing basis was off 5 percent to Aus$6.49 billion (US$4.6 billion) in the full year to September 30.(Photo: AFP)

Australia's ANZ announced a slide in full-year profits Wednesday, weighed down by restructuring costs, payouts linked to misconduct charges and "strong headwinds" in the retail banking sector.

But including discontinued operations, profit fell 16 percent to Aus$5.8 billion, while statutory net profit was flat at Aus$6.4 billion.

The result came after a series of divestments designed to simplify ANZ activities, including the sale of businesses in a number of Asian countries and the sale of its life insurance arm.

It also followed a scathing royal commission report that accused ANZ and Australia's other main banks -- among the developed world's wealthiest -- of widespread misconduct, including providing dodgy financial and life insurance advice and mortgage fraud.

ANZ reported earlier in the year that its dealings with the inquiry will cost about Aus$50 million in legal and other costs.

Chief executive Shayne Elliott said the full-year results also reflected difficulties across the banking sector, but that the restructuring put ANZ in a good position to face the challenges.

"Retail banking in Australia faced strong headwinds with housing growth slowing and borrowing capacity reducing," he said.

But he added: "The actions taken in recent years to simplify our business have allowed us to reduce cost, rebalance capital and better remediate issues. This places ANZ in a stronger position to meet the challenges facing the industry."

Elliott also said ANZ was "engaging constructively" with the royal commission and "taking action to fast-track changes" required to "earn the trust and respect of our customers and the community."


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