ANZ Corporate business feeling the pinch of competition
(22 February 2006 – Australia) ANZ has described the first four months of financial year 2006 as "reasonably strong", saying total income is in line with the target range of seven to nine percent.
The bank said lending and deposits had been particularly strong but that the Corporate and Institutional businesses had seen margins pressured by the high level of competition.
"Corporate is experiencing good volume growth with lending up 11 percent and deposits up 10 percent on the same period last year. This has however been offset by margin pressure in a highly competitive market, particularly the middle market segment," ANZ said.
"The business is continuing to invest in front line resources, particularly in the Small Business Segment which is driving growth in net customer numbers. Credit quality remains strong," it said.
ANZ chief executive John McFarlane said the bank’s portfolio of earnings was different to expectations with Personal performing strongly and New Zealand recovering from a flat couple of years.
"Earnings from our smaller divisions – Corporate, Asset Finance and Asia Pacific – are weaker than plan," he said.
"Our growth and transformation program is showing early results, particularly in Personal, and we should see further revenue and cost benefits emerging during 2006," McFarlane said.
"This will provide good business momentum as we move into 2007," he said.
"Corporate is experiencing good volume growth with lending up 11 percent and deposits up 10 percent on the same period last year. This has however been offset by margin pressure in a highly competitive market, particularly the middle market segment," ANZ said.
"The business is continuing to invest in front line resources, particularly in the Small Business Segment which is driving growth in net customer numbers. Credit quality remains strong," it said.
ANZ chief executive John McFarlane said the bank’s portfolio of earnings was different to expectations with Personal performing strongly and New Zealand recovering from a flat couple of years.
"Earnings from our smaller divisions – Corporate, Asset Finance and Asia Pacific – are weaker than plan," he said.
"Our growth and transformation program is showing early results, particularly in Personal, and we should see further revenue and cost benefits emerging during 2006," McFarlane said.
"This will provide good business momentum as we move into 2007," he said.
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