ANZ keen to stay out of price war
(7 September 2004 – Australia) ANZ has told shareholders the bank will avoid pricing "sub-economically" to maintain its market share in an environment of shrinking margins.
ANZ chief executive John McFarlane said he expected interest margins to continue declining and that price competition had also been noticeable.
"There has been much said recently regarding net interest margins and competition. Banking is a competitive industry and margins have been contracting for many years," he said.
"Our approach continues to be to price competitively, but not sub-economically, to maintain our customer franchise and share."
ANZ said it remained on track to deliver a record result and earnings per share growth of at least nine percent for 2004.
The bank, which reports its FY 2004 result on 26 October, said its corporate and small business divisions were expected to deliver strong earnings growth underpinned by 17 percent lending growth and annualised deposit growth of 10 percent.
However, ANZ said subdued demand in institutional markets and continued de-risking meant performance would be flat.
"Our performance so far this year is pleasing. The strength of our earnings in core businesses means we have the flexibility to deliver on market expectations while we invest in our franchise for future growth," McFarlane said.
He said personal banking had performed strongly for the third year running and that asset growth in mortgages was up 19 percent and deposit growth up an annualised 11 percent.
"There has been much said recently regarding net interest margins and competition. Banking is a competitive industry and margins have been contracting for many years," he said.
"Our approach continues to be to price competitively, but not sub-economically, to maintain our customer franchise and share."
ANZ said it remained on track to deliver a record result and earnings per share growth of at least nine percent for 2004.
The bank, which reports its FY 2004 result on 26 October, said its corporate and small business divisions were expected to deliver strong earnings growth underpinned by 17 percent lending growth and annualised deposit growth of 10 percent.
However, ANZ said subdued demand in institutional markets and continued de-risking meant performance would be flat.
"Our performance so far this year is pleasing. The strength of our earnings in core businesses means we have the flexibility to deliver on market expectations while we invest in our franchise for future growth," McFarlane said.
He said personal banking had performed strongly for the third year running and that asset growth in mortgages was up 19 percent and deposit growth up an annualised 11 percent.
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