Full-year results show more lending via mortgage advisers
Despite difficult conditions, ANZ New Zealand has enjoyed 3% growth in new home lending, while the percentage of home loans facilitated through the adviser channel has increased.
In its full-year results, the bank announced a $2.2 billion cash net profit up 10% compared to last year and a statutory profit of $2.1 billion, down 7%.
New home lending amounted to $19.3 billion across the year (up 3%), business and agri lending were down by 2%, while customer deposits were up by 2%.
The proportion of home loans through the adviser channel was 60%, up from 56% for FY22, the bank confirmed.
ANZ Bank NZ chief executive officer Antonia Watson (pictured above left) said it was a “good result”, summing up the year as “a game of two halves”.
The first half of the 2022-23 financial year reflected the “tailwinds” of the COVID fiscal stimulus in the economy, together with a series of rapid increases in the official cash rate, she said.
“But in the second half of the year our performance slowed due to the more difficult environment New Zealand is entering,” Watson said.
“However, we’re a well-managed, resilient business and remain well placed to support our customers and the New Zealand economy as we enter more challenging periods.”
ANZ managing director personal banking Ben Kelleher (pictured above right) said that the bank continued to value the adviser channel.
“Our relationship with our broker network is one we value; they provide a good service for customers who prefer to use the services of a mortgage broker,” Kelleher said.
“Advisors continue to play an important role supporting our customers, many of whom are navigating rising interest rates and increased cost of living.”
ANZ home lending up 3% year-on-year
New home lending of $19.3 billion was up 3% for the year, which Watson said was supported by contact with new and existing home loan customers.
“One of the ways we did that was through a campaign giving our mortgage holders reassurance and support when making decisions about home lending,” she said.
The bank said it held free, no obligation home loan check-in conversations, which saw 12,000 people complete a home loan check in, many taking follow-up action to manage their financial situation.
Over 30,000 customers due to refix their home loan at a higher rate were contacted to ensure they were aware of the options available to them, ANZ said.
Mortgage stress expected to rise, says ANZ
Amid inflationary pressures and higher interest rates, Watson said that the bank was prepared for a “potentially difficult year ahead” with the incoming Government facing “a number of fiscal challenges” and central banks still trying to tame inflation.
Inflation is expected to remain above the Reserve Bank’s target range, interest rates will likely be higher for longer and unemployment is expected to rise, Watson said.
ANZ expects to see more stress amongst mortgage holders and businesses, she said.
The majority of ANZ home loan customers had moved onto higher interest rates and most had “adapted well”, Watson said. Around 34% of home loan accounts were on rates lower than 5%, with around a third of those due to roll over onto higher rates over the coming six months.
ANZ: More customers are behind on repayments
ANZ confirmed that the portion of home loans behind on repayments by 90 days or more had increased from 0.36% for FY22, to 0.60%.
As a result, the amount put aside for potential bad debts had increased by $144 million, total credit impairment provisions increasing to $857 million.
The bank said it was also putting more resource into its customer hardship team.
ANZ full-year results snapshot (to September 30, 2023)
- Cash profit of $2.2 billion, up 10%
- Statutory profit of $2.1 billion, down 7%
- Revenue of $5 billion, up 10%
- Expenses up $13 million (1%)
- Credit impairment charge of $183 million, up $144 million
- Home lending growth of $19.3 billion, up 3%
- Business and agri lending down 2%
- Customer deposits up 2%, net loans and advances up 2%
- Funds under management of $37.1 billion, up 8%.
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