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Jablko said provisions for remediation costs have been ongoing for the last 18-24 months as the bank worked hard to review customer issues.
“We started early, so we’ve been going for quite a while… They’re reviewing all our products, trying to do the largest, most risky products first,” she said.
Touching on capital allocation, Jablko said the bank continues to hold a very strong position: “we’re well above our peers, unquestionably strong and well ahead of time”.
“Over the last few years, we have been able to allocate capital to best use, to generate organic capital for shareholders,” she said. “Looking forward, we’ve got some challenges ahead, particularly in New Zealand, that we will need to work through but it’s a bit early to tell what the ultimate impact of that will be.”
The CFO said the credit environment in Australia continues to be benign but that can’t last forever and there was some pockets of stress the bank was watching – although a tick-up in housing stress was off a very low base.
“We’ve changed our portfolio and that’s having a real impact. Our long-run loss-rate is down about a third compared to where it was three years ago – a really big change in a short amount of time,” said.
You can hear more of the conversation in the video above.
Andrew Cornell is managing editor of bluenotes