04 May 2022
ANZ Chief Financial Officer Farhan Faruqui says the bank’s first-half performance was “quite exemplary” in a highly competitive and uncertain environment.
Speaking with bluenotes on video, Faruqui said efficient business practices and increased productivity enabled flat “run the bank” costs despite record high inflation levels.
“There has been a mix of progress in some areas and great performances in others. We want to continue to build on that in the second half.” – Farhan Faruqui
“Cost management discipline… has become part of the DNA of ANZ so I’m quite pleased with that,” he explained.
“Our investment spend remained elevated but we're increasingly investing towards growth and productivity initiatives which will yield benefits for us to become a more resilient and a more profitable and growing bank in the future.”
ANZ’s statutory profit after tax for the half year ended 31 March 2022 was $A3,530 million, up 10 per cent on the previous half.
Faruqui says the bank’s New Zealand business has gone from “strength to strength” in growth and has continued to gain market share. The Institutional bank (excluding Markets) saw solid growth in target segments such as financial institutions, sustainable finance, and supply chains in food, beverage and agriculture. On home loan momentum in the Australia Retail business, Faruqui says the bank has fulfilled its commitment to return the balance sheet to growth.
“There has been a mix of progress in some areas and great performances in others. We want to continue to build on that in the second half,” he said.
Faruqui says the bank needs to be careful how it thinks about a rising interest rate environment as it comes with “both positives and negatives”.
“While it is supportive from a revenue standpoint, we also have to understand that lots of things will change,” he explains. “Customer behaviours will shift and we have to anticipate [that] and make sure we position our balance sheet and our customers’ business accordingly.”
Faruqui also discussed the bank’s ongoing focus on prudent capital management activity, noting ANZ has returned around $A5.5 billion to shareholders over the past few years.
“While we have a very strong capital position and we are well above the unquestionably strong benchmark required by our regulators, we do think this is a time to reflect on the opportunities available to us in this shifting environment before we make capital return decisions,” he said.
“At this point, we are in the process of evaluating the first and best use of capital from a shareholder perspective before making any decisions.”
You can listen to the full conversation by watching to the video above.
Andrew Cornell is Managing Editor of bluenotes
04 May 2022
04 May 2022