ANZ Bank’s profits jumped 23 per cent in the first half to A$3.4 billion (NZ$3.7 billion), as the Australian-based lender’s bottom line benefited from much lower charges for bad loans.
Interim results from ANZ for its total business on Tuesday showed that even though interest income slipped 2 per cent in the half, charges for bad loans also fell 22 per cent, as credit quality improved.
The bank, which has been shedding lower-returning assets to focus on its core Australian business, will pay a fully-franked dividend of 80c a share, unchanged from the previous half.
The result compares with market expectations for a cash profit of A$3.5b, with an interim dividend of 80c a share.
READ MORE: ANZ reports drop in profit, points to lack of deposits as a challenge
“The reshaping of our business over the past year has delivered strong outcomes for customers and shareholders, and has established a foundation for future growth and better returns” ANZ chief executive Shayne Elliott said.
“The environment for banking remains constrained with intense competition and pressure on margins, subdued lending growth, rapidly changing customer expectations and increasing regulation. The provision charge has improved and the outlook for the second half remains broadly neutral.”
ANZ is the first of three major Australian banks to deliver their half year results over the next week, with BNZ owner National Australia Bank reporting its interim results on Thursday, and Westpac following next Monday.