As expected the ANZ’s 2016-17 profit rose strongly from the previous year’s weaker outcome that was hit by more than $1 billion in write offs and other charges. The bank said cash profit rose 18% to $6.94 billion, just short of the $7 billion some analysts had pencilled in.
The bank will pay an unchanged final dividend of 80 cents a share. That makes the full year payout an unchanged $1.60 a share.
The bank’s net interest margin fell to 1.99 cents in the dollar from 2.07 cents.
But while CEO Shayne Elliott expressed satisfaction at the latest result, he warned that the outlook wasn’t as rosy.
“This is a good result which demonstrates further progress in becoming a better balanced, better capitalised, more efficient bank,” he said in this morning’s statement
“In 2018 we expect the revenue growth environment for banking will continue to be constrained as a result of intense competition and the effect of regulation including a full year of impact of the Australian bank tax," he said in a statement to the ASX on Thursday morning.
The result follows a series of divestments made since Mr Elliott became chief executive in January 2016 – especially in Asia and in the bank’s wealth management business.
The bank said its common equity tier 1 capital ratio was 10.6%, up 96 basis points, which is about where bank regulators want it to be.
Return on equity increased 159 basis points to 11.9%.
ANZ’s full-year result is some way behind rival Commonwealth Bank, which reported a record $9.88 billion annual profit in August and which will release a first quarter update at next month’s AGM.
