ANZ Bank remained on track to deliver continued improvement in business growth and financial performance, chief executive Mike Smith said yesterday.
The bank announced an unaudited cash profit of $ A1.73 billion ($ NZ1.87 billion) for the three months ended December, up 13% on the previous corresponding period.
The unaudited reported profit was $ A1.64 billion, up nearly 21% on the $ A1.36 billion reported in the pcp.
Bank profit margins have lately caused controversy, particularly in New Zealand where the profits from the local branches are repatriated back to Australia.
Bank union officials and Opposition politicians are particularly vocal in their criticism of the amount of profit being taken out of the country.
Mr Smith said the Australian division of the bank again grew market share in both the retail and corporate and commercial divisions during the quarter, while making further investments through the Banking on Australia programme.
In New Zealand, the bank consolidated its market-leading position while producing further benefits from the simplification programme.
The global wealth division continued to improve business performance through productivity gains and increased sales of wealth solutions to bank customers.
”The bottom line is that we have made a good start to 2014,” Mr Smith said.
”There remain a number of challenging issues in the global economic environment. However, these are now largely more predictable.
”Our performance in the first quarter means we are on track to deliver a solid 2014,” he said.
Morningstar analyst David Ellis said the ANZ update was in line with his expectations with solid revenue growth, modest expense growth and lower bad debts again featuring.
Conservative management, modest revenue growth, relatively stable net interest margins, tight cost control and lower bad debts provided increasing confidence the bank was executing well on its long-term growth strategy, he said.
The standout was the improvement in loan quality and bad debt expense of only $ A191 million, reflecting continued low interest rates and low levels of corporate leverage.
Guidance for full-year 2014 was updated, with total bad debt expense now expected to be 10% lower than the $ A1.2 billion reported in 2013, Mr Ellis said.