ANZ Chief Executive Officer Shayne Elliott said: “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.
“Retail banking in Australia faced strong headwinds with housing growth slowing and borrowing capacity reducing. We continued our disciplined approach to home loan growth by focusing on customers who want to buy and own their own home.
“While this meant we sacrificed short-term revenue growth and higher margins in Australia, particularly in the investor and interest-only segments, it was the right thing to do for shareholders.
“New Zealand again delivered a strong performance, while the composition of our Institutional results provided improved and diversified earnings. Both of these businesses have undergone significant transformations in recent years with our diversification becoming even more important as housing credit slows in Australia.
“The simplification of our business is continuing to benefit shareholders through our announced $3 billion share buy-back and the neutralisation of the Full Year Dividend Reinvestment Plan (DRP), while we also maintained a capital position well above our regulatory target.
“Expenses were up slightly for the year due primarily to increased customer compensation and remediation costs in Australia. Excluding large notable items, expenses were down 1.5% for the year, positioning us to better manage the headwinds impacting the sector.
“The lowest credit losses in a generation have been driven by our decision to change the composition of our loan book, the sale of our Retail business in Asia, together with the run-down of our mid-market commercial business in Asia and a relatively benign credit environment.
“We are engaging constructively with the Royal Commission and taking action to fast-track changes. We will make the investments required to earn the trust and respect of our customers and the community.
“We continue to support our customers facing difficult circumstances. During the half ANZ implemented a significant package to help our customers impacted by the recent drought. This included reducing rates on business loans for farmers by 1% in all drought declared areas and setting aside $130 million for discounted loans to help farmers re-stock and re-plant next season. We also excluded all home owners in drought declared regional Australia from a recent interest rate increase.
“While there was much to be pleased about this year, we accept the significant community concern as a result of our failures highlighted by the Royal Commission has impacted our standing in the community.
“This was a factor in the decision to reduce variable remuneration paid to staff this year across the bank by $124 million3. We are also undertaking the urgent work required to fix the failures that have been highlighted by the Commission and further increased our focus on conduct issues,” Mr Elliott said.
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