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UPDATE 1-Australia's ANZ posts slowest growth since global financial crisis

Published 29/10/2015, 08:42 am
© Reuters.  UPDATE 1-Australia's ANZ posts slowest growth since global financial crisis
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(Adds comment about Asia division, more earnings metrics shares)

SYDNEY, Oct 29 (Reuters) - Australia and New Zealand Banking Group ANZ.AX on Thursday posted its lowest growth in annual profit since the global financial crisis as lending growth eased and trading income disappointed amid an economic slowdown in China.

Cash profit, which excludes one-offs and non-cash accounting items, rose 1 percent to A$7.2 billion ($5.11 billion) for the 12 months to Sept. 30, just missing a A$7.3 billion consensus of five analysts polled by Reuters.

"Lower economic growth, intense competition, the growing cost of regulation and market volatility present headwinds for all banks," outgoing CEO Mike Smith said in a statement.

ANZ is Australia's No.4 lender by assets and the only one of its major banks to have an Asia-focused strategy. It announced a final dividend of 95 cents.

The lender has been under pressure from shareholders to re-consider a low-return strategy of developing a large business outside its home market.

On Thursday, ANZ said it was focusing on "attractive opportunities in cash management" at its international and institutional banking division while stepping away from lower-return trade finance.

It was also restricting growth in risk-weighted assets to better manage capital, Smith added.

Cash profit at its international and institutional banking division fell 2 percent as a global market rout in August caused "significant dislocation and a widening of credit spreads" impacting trading income and supressing sales.

Meanwhile, profit at its Australia division rose 7 percent.

The net interest margin stood at 2.04 percent, unchanged from prior half.

Loan impairment charges jumped 39 percent in the second half of the year to A$685 million but for the full year remained in line with its guidance of A$1.2 billion.

ANZ shares are the worst performers of the "Big Four" banks so far this year, down 10.4 percent.

On Wednesday, top lender National Australia Bank NAB.AX missed forecast to post a 15.5 percent growth in cash profit.

($1 = 1.4083 Australian dollars)

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