The banks are back.
ANZ joined rivals Commonwealth, NAB and Westpac in justifying the big rally in their shares since early November with a solid trading update for the December quarter on Thursday.
The big four have seen 20% plus rises in the value of their shares since late October-early November as investors realised they had been damaged by COVID.
The appearance of successful vaccines also helped switch investor focus to more traditional value stocks and the banks have rewarded that returned attention from the market with solid earnings update – the CBA for the half year to December and the ANZ, NAB and Westpac for their first quarters.
ANZ reported a rise in cash profit for the December quarter in another sign the big four banks have emerged from the COVID=pandemic sell-off in solid shape with little of the feared bad debt concerns.
But they still have to weather the downturn expected after JobKeeper and JobSeeker are ended in around six weeks (or reduced to a more targeted scheme).
Still all banks have seen a material drop in deferred loans -housing especially -and small business deferments have also fallen sharply as business activity improves from the hit administered by COVID-19.
ANZ said on Thursday its unaudited statutory profit after tax for the first quarter of the financial year was $1.6 billion, up from a quarterly average of $773 million the first half of last year.
The quarterly trading update was a first for ANZ since the Global Financial Crisis to keep the market informed during the uncertain environment brought on by the coronavirus pandemic.
CEO Shayne Elliott said the bank’s performance had been strong during volatile trading conditions, which “again highlights the benefits of disciplined execution of our strategy as well as maintaining a simpler and well-balanced portfolio of businesses”.
“We’re pleased to have achieved these results for shareholders while also helping customers in difficulty and providing the vital lending needed to support the economic recovery,” Mr Elliott said in the update.
Mr Elliott also said all its major business clients had performed well through the quarter, adding ANZ had expanded its market share of Australian and New Zealand home loans.
