ANZ’s full-year statutory profit has fallen by 10 per cent after a bruising $240m fine from the corporate watchdog for widespread misconduct.
Statutory profit as of September 30 had fallen from the previous year to $5.9bn, according to full-year results released on Monday.
Cash profit also fell by 14 per cent following settlement with ASIC as well as restructuring charges.
Chief executive Nuno Matos said results were impacted by significant items of $1.1bn, as ANZ resolved “longstanding regulatory investigations” and actions taken to simplify the business.
“While our financial performance held steady when excluding these items, our performance as a business reinforces the importance of our ANZ 2030 strategy,” he said.
Mr Matos said results showed that the bank and its affiliates were in a strong and competitive position but admitted “action is needed”.
It comes after ASIC announced ANZ Bank had admitted to engaging in unconscionable conduct in services it provided to the federal government.
The big four bank admitted to incorrectly reporting its bond trading data to the Australian government by tens of billions of dollars as well as widespread misconduct across products and services provided to almost 65,000 customers.
ASIC said in September that it would be asking the Federal Court to impose penalties totalling $240m for the offences.
It was the 11th time that action had been taken against ANZ in a little more than a decade, ASIC chair Joe Longo said at the time.
“We have been here before with ANZ,” he said.
“The bank has a history of noncompliance in markets matters, for misconduct in foreign exchange, continuous disclosure, and the bank bill swap rate matter.”
In a statement, ANZ chair Paul O’Sullivan acknowledged the bank had “made mistakes that have had a significant impact on customers”.
“On behalf of ANZ, I apologise and assure our customers we have taken the necessary action, including holding relevant executives accountable,” he said.
The penalty came only days after Mr Matos announced the bank would be cutting 3500 staff and about 1000 contractor positions in the nest year.
Retail and Private Bank ‘underperforming’
Of ANZ’s four main divisions, only the Institutional and New Zealand Divisions “performed consistently well”, Mr Matos said.
The Australia Retail and Business and Private Bank both underperformed.
“Despite growth in both assets and deposits, intense competition and a falling interest rate environment impacted margins,” Mr Matos said.
The bank recorded a final dividend of 83 cents per share, which Mr Matos said reflected the “underlying financial performance of the business” and confidence in ANZ 2030.
“We continue to make progress on our immediate priorities at pace, including embedding our leadership team and our culture reset, accelerating the integration of Suncorp Bank, delivering the ANZ Plus single-customer front-end, simplifying the bank and reducing duplication, and improving non-financial risk management,” he said.
“Our strong capital position enables us to deliver on our immediate priorities to ensure we get the basics right, including a substantial improvement in productivity and initial investment for the bank’s growth.”
Mr Matos said a significant amount of work was already under way to support a business and cultural transformation “which will deliver a better-run bank for our customers”.
