ANZ Group Holdings Limited posted a 7% increase in statutory profit to AUD 3.642 billion for the half year ended 31 March 2025, with stable cash profit and an 83 cent interim dividend. The full integration of Suncorp Bank underpinned lending and deposit growth, while credit impairments eased.
- 7% increase in statutory profit to AUD 3.642 billion
- Stable cash profit at AUD 3.568 billion
- Interim dividend declared at 83 cents per share, 70% franked
- Suncorp Bank acquisition fully integrated, driving asset growth
- Credit impairment charges significantly reduced compared to prior half
Strong Profit Growth and Dividend Stability
ANZ Group Holdings Limited has reported a solid financial performance for the half year ended 31 March 2025, with statutory profit attributable to shareholders rising 7% to AUD 3.642 billion. This growth was supported by a 10% increase in statutory operating income to AUD 11.179 billion. Despite the rise in statutory profit, the Group's cash profit, a preferred measure excluding non-core items, remained stable at AUD 3.568 billion.
The Board declared an interim dividend of 83 cents per share, partially franked at 70%, maintaining the dividend level from the previous year. This dividend will be paid on 1 July 2025, reflecting ANZ’s commitment to delivering consistent shareholder returns amid evolving market conditions.
Suncorp Bank Acquisition Fully Integrated
The half year results mark the first full six months of Suncorp Bank’s integration following ANZ’s acquisition completed in July 2024. The acquisition has contributed significantly to lending and deposit growth, with net loans and advances increasing 15% to AUD 820.2 billion and customer deposits rising 6% to AUD 756.6 billion. The purchase price allocation exercise led to the recognition of intangible assets, including core deposit and brand intangibles, which are being amortised over their useful lives.
While the amortisation of these acquired intangibles impacted statutory profit, it is excluded from cash profit to better reflect the Group’s core operating performance. The goodwill arising from the acquisition stands at AUD 1.205 billion as of 31 March 2025, reflecting expected synergies and workforce value.
Credit Quality and Risk Management
ANZ’s credit impairment charges fell sharply by 57% compared to the previous half, to AUD 145 million, driven by improved economic assumptions and portfolio performance. The Group’s allowance for expected credit losses increased modestly by 2% to AUD 4.644 billion, reflecting portfolio growth and some deterioration in credit risk profiles, partially offset by favourable economic scenario revisions.
Gross impaired assets rose 33% to AUD 2.252 billion, primarily due to restructured home loan facilities and new impairments in commercial property portfolios, including those from the Suncorp Bank acquisition. The Group’s individually assessed provision coverage ratio on gross impaired assets was 16.2%, down from 18.2% in the prior half, reflecting an increase in well-secured impaired assets.
Capital, Liquidity and Regulatory Developments
ANZ maintained a strong capital position with a Common Equity Tier 1 (CET1) ratio of 11.8%, slightly down from 12.2% in September 2024, influenced by lending growth and dividend payments. The Group’s liquidity metrics remain robust, with a Liquidity Coverage Ratio of 132% and a Net Stable Funding Ratio of 117%, both comfortably above regulatory minimums.
Notably, ANZ entered into a court enforceable undertaking with the Australian Prudential Regulation Authority (APRA) concerning non-financial risk management practices, resulting in an additional operational risk capital overlay of AUD 250 million effective from 30 April 2025. The Group continues to monitor regulatory changes, including APRA’s evolving capital adequacy standards and the Reserve Bank of New Zealand’s capital requirements.
Operational and Divisional Highlights
Operating expenses increased 10% to AUD 5.742 billion, reflecting the Suncorp acquisition and inflationary pressures, partially offset by productivity initiatives. Divisional performances varied, with Australia Retail and Institutional divisions showing solid lending growth, while other divisions experienced mixed income and expense trends.
Markets division income was softer amid challenging trading conditions, while the New Zealand division posted modest growth in net interest income and cash profit. The Group Centre continued to focus on cost efficiency and capital optimisation.
Bottom Line?
ANZ’s results underscore steady growth and integration success, but regulatory overlays and credit quality trends warrant close investor attention.
Questions in the middle?
- How will APRA’s operational risk capital overlay impact ANZ’s capital strategy going forward?
- What are the prospects for margin recovery amid competitive pressures in home lending?
- How will evolving regulatory capital requirements in New Zealand affect the Group’s capital allocation?