ANZ Chief Executive Officer Shayne Elliott said: “The work started in 2016 to simplify our business and strengthen our balance sheet has helped us weather the strong headwinds in Australian retail banking, while still producing a balanced financial outcome for shareholders.
“Home loan demand in Australia has slowed significantly and this continued during the half. While our decision to step back from certain segments compounded this impact, being more risk averse in the current environment is prudent. However, we do accept we could have done a better job implementing our new risk settings and are taking steps to improve processes.
“Other parts of the business performed solidly. Institutional has been transformed into a well-managed business delivering consistent and diversified results for shareholders as well as customers. New Zealand also put in another good performance.
“The completion of our $3 billion buy-back resulted in a 3.7% reduction in shares, helping drive a strong increase in earnings per share. We also plan to neutralise the dividend reinvestment plan (DRP) for the fifth consecutive half and remain the only major Australian bank to have reduced shares on issue.
“Action taken over the last three years to improve the composition of our lending book, combined with a relatively benign credit environment, resulted in a good credit quality outcome.
“Cost control was a highlight with absolute expenses down for another half. In fact, since the end of 2015 we have absorbed inflation of around $550 million while also reducing the cost of running the bank by approximately $300 million, even when excluding divestments.
“The tough retail banking environment will be a reality for the foreseeable future. We knew three years ago there would be strong headwinds and have taken action to respond head-on, including restructuring our Australian business,” Mr Elliott said.