ANZ Group Holdings’s profit missed estimates as chief executive officer Shayne Elliott said competition in the mortgage market remained intense.
Cash profit slipped to A$6.7 billion (S$5.9 billion) in the 12 months to Sep 30, from A$7.4 billion the previous year, the Melbourne-based lender said on Friday (Nov 8). That compared with the A$6.8 billion average estimate in a Bloomberg survey of analysts.
The result points to the challenge for the nation’s biggest banks, which are losing the benefits of the high interest rate cycle. With rates potentially poised to fall next year in Australia, that could weigh on margins and intensify the battle for home loans.
“Competition in the sector has continued to be intense, particularly in home lending and deposits,” Elliott said.
ANZ is also contending with an investigation by the nation’s securities regulator into the trading of government bonds, while traders earlier this year departed the bank amid allegations of misconduct.
“We are expediting the work we have underway to improve our non-financial risk practices,” Elliott said. “This, along with continuing to drive a strong speak-up culture, is a key focus of mine as CEO – as well as across the bank more broadly.”
In its Australian retail business, the firm said home loans grew 7 per cent, as did customer deposits. Its institutional unit saw strong growth in operational deposits and markets revenue came in at A$2.2 billion, up 4 per cent on last year.
Hardship support
“Higher interest rates are impacting customers and we saw an increase in those requiring hardship support,” Elliott said. “Our data shows customers, in general, are holding up better than expected.” BLOOMBERG
