ANZ continues to grow but remains cautious of the economic environment despite posting a solid increase in cash profit for the first quarter.
Speaking to BlueNotes on video after the announcement, ANZ CEO Shayne Elliott said the bank was pleased with the result, which included customer growth driven by technology initiatives and a reduction in costs.
“We’re getting growth in the right areas,” he said. “The areas we are committed to, the areas we want to grow.”
In the three months to December 31, ANZ posted a cash profit of $A2 billion, a 31 per cent improvement on the previous corresponding period.
Despite the performance, Elliott said the low-growth environment in the bank’s key markets had continued.
“The reality is that the economy has slowed down a little bit,” he said. “Australia’s a great place to be, New Zealand’s a great place to be, Asia’s a great place to be, but growth rates have just tempered down a bit. That affects our business.”
The CEO was particularly happy with the cost result, saying it would allow the bank to continue to invest in new technology and competitive products for customers.
‘’That’s a pretty big step for large organisations like this,” Elliott said. “And there clearly has to be more to come.”
“That allows us to invest… into more customer-focused costs. Things like Apple Pay, things like the whole digital experience which we want to continue to improve. “
Capital generation was a standout, with the bank almost doubling its capital base compared with the last few years, Elliott said.
“Our number one priority is to have really strong organic capital generation,” he said. “That alone has put us in a great position.”
“We’ve really transformed ANZ from a capital position… and there’s more to come on that.”
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Elliott said the bank was slightly more optimistic about its bad debt provisions, which were previously expected to be in line with its 2016 results.
“We’ve always got to be cautious when we look at credit quality because one quarter doesn’t make a year,” he said. “Sitting where we are today with that proviso… we would expect them to be marginally better than that.”
Elliott also touched on customer satisfaction in the group’s institutional arm. Watch the video above to find out more.
Andrew Cornell is managing editor at BlueNotes
The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.