ANZ(ASX:ANZ) boosts cash profit in first half; how are shares faring?

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  • ANZ reported a 4% (year-on-year) rise in 1H cash profit from continuing operations.

  • However, cash profit was down 3% on the second half of FY2021.

  • ANZ’s board also declared an interim dividend of 72 cents per share fully franked.

Australia and New Zealand Banking Group Ltd (ASX:ANZ) on Wednesday reported a 4% (year-on-year) rise in cash profit from continuing operations to AU$3.1 billion during the six months ending 31 March 2022. The profit boost was majorly driven by its Australia Retail and Commercial and New Zealand segments. However, cash profit was down 3% on the second half of FY2021.

ANZ’s board also declared an interim dividend of 72 cents per share fully franked, unchanged from the previous amount. The latest dividend paid by ANZ was 2 cents higher (Y-O-Y). The bank reported a payout ratio of 57%.

By 10:05 AM (AEST), ANZ shares were trading at AU$27.79, up 1.94%. The stock is down over 2.6% on a year-to-date (YTD) basis. In the past year, the stock has dropped more than 5%. However, in the past month, the ANZ share price is up over 0.5%.

ANZ also announced a 20% rise in statutory profit to AU$3.5 billion. Group net interest margin slipped to 1.58% from 1.65% as measured at the previous result in September 2021. Net interest margin (NIM) was down 7 basis points during the given half to 1.58% and the CET1 ratio fell 81 basis points to 11.53% during the period.

Hits and misses

  • The Australia Retail and Commercial segment reported a rise of 11% in cash earnings to AU$1,986 million after the bank boosted its home loan processing capacity by 30%.
  • In New Zealand, the bank reported a 2% rise in cash earnings to AU$787 million.
  • ANZ’s institutional business reported weak growth and reported a 23% fall in cash earnings to AU$730 million.

What does ANZ’s management say?

ANZ’s Chief Executive Officer (CEO), Shayne Elliott, remains upbeat about the bank’s prospects going ahead.

“Looking ahead, the economic environment is likely to be very different and we will continue to adjust our risk appetite, business settings and investment priorities as required. We are already seeing increased demand from our business customers, and we are well placed to continue to support them as they manage in a world of higher inflation and interest rates,” said Elliot.

“For ANZ, we will continue to focus on the long term – investing for tomorrow and not just running today,” the CEO added.

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