ANZ fit for tough new world of banking: Elliott

Speaking to bluenotes on video on the morning of the result, Elliott said the bank’s broader operating environment had been sound although pressure in the Australian retail banking sector has weighed on earnings. 

"We’ve been simplifying our business and readjusting our operating methods so we’re fit and lean and ready to adapt for that future world.”

ANZ posted a cash profit on a continuing basis of $A6.49 billion in the September financial year, a 5 per cent decline on the previous corresponding period. Statutory profit was flat at $A6.4 billion.

“The environment we’re operating in today, particularly in our Australian retail business, is pretty tough,” Elliott said. “There’s a lot of challenges out here in terms of softening house prices [and] people are a little less confident than they have been in the past.” 

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The CEO said ANZ expects the subdued conditions to last for the foreseeable future, including around revenue growth, but the bank maintained considerable flexibility with its capital base.  

“We don’t think that’s a temporary shift [in conditions],” Elliott said.” We think it’s quite permanent and therefore we’ve been simplifying our business and readjusting our operating methods so we’re fit and lean and ready to adapt for that future world.”

ANZ’s reshaping is delivering results across the business, Elliott said, making ANZ a simpler, safer and better-quality bank. He said the best strategy for running a bank in the future is about being “selective, being targeted [and] being able to adapt quickly to customer needs”.

Costs continued to fall but Elliott warned revenue growth would continue to be tough so ANZ needed to continue its efforts on reducing the absolute cost of running the bank.

He also touched on positive credit conditions, the bank’s increased productivity outlook and learnings from the bank’s New Zealand simplification. Watch the video above to find out more.

Andrew Cornell is managing editor at bluenotes