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MarketScreener Homepage  >  Equities  >  Australian Stock Exchange  >  Australia and New Zealand Banking Group Limited    ANZ   AU000000ANZ3

AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED

(ANZ)
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Australia and New Zealand Banking : Update on impact of large notable items on 2H20 results

10/27/2020 | 01:35am EST

News Release

For Release: 27 October 2020

Update on impact of large notable items on 2H20 results

ANZ today announced its second half 2020 Cash Profit will be impacted by an after tax charge of $528m (approximately a 5 basis points impact on common equity tier one capital) as a result of large notable items, including remediation costs and accelerated software amortisation. The charge impacts Statutory Profit by a similar amount.

Remediation charges recognised in the second half of 2020 will be $188m (after tax), largely related to an acceleration of remediation programs and product reviews across the Group.

Changes to the application of ANZ's software amortisation policy resulted in a $138 million (after tax) charge being recognised in the second half of 2020. These changes were made to reflect the increasingly shorter useful life of various types of software assets caused by rapidly changing technology and business requirements.

The remaining charges of $202m (after tax) include the write-down of goodwill in ANZ's Pacific business, the impact of AASB 9 accounting changes on ANZ's investment in PT Panin and restructuring charges.

The following tables are provided to illustrate the impacts of the above items to cash continuing profit after tax (versus prior comparable periods):

Item

2H 2020

1H 2020

Movement

($m)

($m)

($m)

Customer remediation

188

91

97

Accelerated software amortisation

138

-

138

Goodwill write-off

77

-

77

Asian Associate AASB 9 adj

66

-

66

Asian Associate impairments

-

815

(815)

Restructuring

41

74

(33)

Lease related items

14

58

(44)

Divestment impacts

4

(27)

31

Total

528

1,011

(483)

Item

Full year 2020

Full year 2019

Movement

($m)

($m)

($m)

Customer remediation

279

475

(196)

Accelerated software amortisation

138

-

138

Goodwill write-off

77

-

77

Asian Associate AASB 9 adj

66

-

66

Asian Associate impairments

815

-

815

Restructuring

115

54

61

Lease related items

72

-

72

Divestment impacts

(23)

(308)

285

Royal Commission

-

10

(10)

Total

1,539

231

1,308

For media enquiries contact:

For analyst enquiries contact:

Stephen Ries, +61 409 655 551

Jill Campbell, +61 412 047 448

Cameron Davis, +61 421 613 819

Approved for distribution by ANZ's Continuous Disclosure Committee

Australia and New Zealand Banking Group Limited

ABN 11 005 357 522

9/833 Collins Street Docklands Victoria 3008 Australia

Large/Notable items - continuing operations

Within continuing cash profit, the Group has recognised some large/notable items. These items are shown in the tables below.

September 2020 Full Year

September 2019 Full Year

Large/notable items included in continuing cash profit

Large/notable items included in continuing cash profit

Asian

Gain/(Loss)

Divested

Lease-

Accelerated

Asian

associate

Gain/(Loss)

Divested

Royal

on sale from

business

Customer

Goodwill

Restructur-

related

software

associate

AASB 9

on sale from

business

Customer Commission

Restructur-

divestments

results

remediation

write-off

ing

items

amortisation

impairments

adjustment

Total

divestments

results remediation

legal costs

ing

Total

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

Cash Profit

Net interest income

-

134

(106)

-

-

(40)

-

-

-

(12)

-

192

(141)

-

-

51

Other operating income

(38)

2

(68)

-

-

22

-

(815)

(68)

(965)

252

54

(71)

-

-

235

Operating income

(38)

136

(174)

-

-

(18)

-

(815)

(68)

(977)

252

246

(212)

-

-

286

Operating expenses

(6)

(34)

(209)

(77)

(161)

(85)

(197)

-

-

(769)

-

(79)

(373)

(15)

(77)

(544)

Profit before credit impairment

(44)

102

(383)

(77)

(161)

(103)

(197)

(815)

(68)

(1,746)

252

167

(585)

(15)

(77)

(258)

and income tax

Credit impairment charge

-

(23)

-

-

-

-

-

-

-

(23)

-

(14)

-

-

-

(14)

Profit before income tax

(44)

79

(383)

(77)

(161)

(103)

(197)

(815)

(68)

(1,769)

252

153

(585)

(15)

(77)

(272)

Income tax benefit/(expense)

10

(22)

104

-

46

31

59

-

2

230

(47)

(50)

110

5

23

41

and non-controlling interests

Cash profit/(loss)

(34)

57

(279)

(77)

(115)

(72)

(138)

(815)

(66)

(1,539)

205

103

(475)

(10)

(54)

(231)

from continuing operations

September 2020 Half Year

March 2020 Half Year

Large/notable items included in continuing cash profit

Large/notable items included in continuing cash profit

Asian

Gain/(Loss)

Divested

Lease-

Accelerated

Asian

associate

Divested

Lease-

Asian

on sale from

business

Customer

Goodwill

Restructur-

related

software

associate

AASB 9

business

Customer

Restructur-

related

associate

divestments

results

remediation

write-off

ing

items

amortisation

impairment

adjustment

Total

results

remediation

ing

items

impairment

Total

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

Cash Profit

Net interest income

-

59

(84)

-

-

(19)

-

-

-

(44)

75

(22)

-

(21)

-

32

Other operating income

(38)

1

(32)

-

-

10

-

-

(68)

(127)

1

(36)

-

12

(815)

(838)

Operating income

(38)

60

(116)

-

-

(9)

-

-

(68)

(171)

76

(58)

-

(9)

(815)

(806)

Operating expenses

(6)

(16)

(138)

(77)

(56)

(11)

(197)

-

-

(501)

(18)

(71)

(105)

(74)

-

(268)

Profit before credit impairment

(44)

44

(254)

(77)

(56)

(20)

(197)

-

(68)

(672)

58

(129)

(105)

(83)

(815)

(1,074)

and income tax

Credit impairment charge

-

(3)

-

-

-

-

-

-

-

(3)

(20)

-

-

-

-

(20)

Profit before income tax

(44)

41

(254)

(77)

(56)

(20)

(197)

-

(68)

(675)

38

(129)

(105)

(83)

(815)

(1,094)

Income tax benefit/(expense)

10

(11)

66

-

15

6

59

-

2

147

(11)

38

31

25

-

83

and non-controlling interests

Cash profit/(loss)

(34)

30

(188)

(77)

(41)

(14)

(138)

-

(66)

(528)

27

(91)

(74)

(58)

(815)

(1,011)

from continuing operations

.

Large/Notable items - continuing operations

Within continuing cash profit, the Group has recognised some large/notable items. The impact of these items on the divisional results are shown in the tables below.

September 2020 Full Year

September 2019 Full Year

Large/notable items included in continuing cash profit

Large/notable items included in continuing cash profit

Asian

Gain/(Loss)

Divested

Lease-

Accelerated

Asian

associate

Gain/(Loss)

Divested

Royal

on sale from

business

Customer

Goodwill

Restructur-

related

software

associate

AASB 9

on sale from

business

Customer Commission

Restructur-

divestments

results

remediation

write-offs

ing

items

amortisation

impairments

adjustment

Total

divestments

results remediation

legal costs

ing

Total

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

Profit before income tax

Australia Retail and

-

-

(270)

-

(89)

(68)

(31)

-

-

(458)

-

-

(447)

-

(20)

(467)

Commercial

Institutional

-

-

(20)

-

(17)

(24)

(38)

-

-

(99)

-

46

(49)

-

(16)

(19)

New Zealand

-

73

(76)

(27)

(31)

(4)

(11)

-

-

(76)

-

105

(75)

-

(8)

22

Pacific

-

-

(17)

(50)

-

(3)

-

-

-

(70)

-

-

(14)

-

-

(14)

TSO and Group Centre

(44)

6

-

-

(24)

(4)

(117)

(815)

(68)

(1,066)

252

2

-

(15)

(33)

206

Profit before income tax

(44)

79

(383)

(77)

(161)

(103)

(197)

(815)

(68)

(1,769)

252

153

(585)

(15)

(77)

(272)

Income tax benefit/(expense)

10

(22)

104

-

46

31

59

-

2

230

(47)

(50)

110

5

23

41

and non-controlling interests

Cash profit/(loss)

(34)

57

(279)

(77)

(115)

(72)

(138)

(815)

(66)

(1,539)

205

103

(475)

(10)

(54)

(231)

from continuing operations

September 2020 Half Year

March 2020 Half Year

Large/notable items included in continuing cash profit

Large/notable items included in continuing cash profit

Asian

Gain/(Loss)

Divested

Lease-

Accelerated

Asian

associate

Divested

Lease-

Asian

on sale from

business

Customer

Goodwill

Restructur-

related

software

associate

AASB 9

business

Customer

Restructur-

related

associate

divestments

results

remediation

write-off

ing

items

amortisation

impairment

adjustment

Total

results

remediation

ing

items

adjustments

Total

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

$M

Profit before income tax

Australia Retail and Commercial

-

-

(169)

-

(4)

(36)

(31)

-

-

(240)

-

(101)

(85)

(32)

-

(218)

Institutional

-

-

(20)

-

(13)

(13)

(38)

-

-

(84)

-

-

(4)

(11)

-

(15)

New Zealand

-

39

(50)

(27)

(20)

(1)

(11)

-

-

(70)

34

(26)

(11)

(3)

-

(6)

Pacific

-

-

(15)

(50)

-

(1)

-

-

-

(66)

-

(2)

-

(2)

-

(4)

TSO and Group Centre

(44)

2

-

-

(19)

31

(117)

-

(68)

(215)

4

-

(5)

(35)

(815)

(851)

Profit before income tax

(44)

41

(254)

(77)

(56)

(20)

(197)

-

(68)

(675)

38

(129)

(105)

(83)

(815)

(1,094)

Income tax benefit/(expense)

10

(11)

66

-

15

6

59

-

2

147

(11)

38

31

25

-

83

and non-controlling interests

Cash profit/(loss)

(34)

30

(188)

(77)

(41)

(14)

(138)

-

(66)

(528)

27

(91)

(74)

(58)

(815)

(1,011)

from continuing operations

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

ANZ - Australia & New Zealand Banking Group Ltd. published this content on 27 October 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 October 2020 06:34:06 UTC


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Technical analysis trends AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED
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TrendsBullishBullishNeutral
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Consensus
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Mean consensus OUTPERFORM
Number of Analysts 14
Average target price 23,17 AUD
Last Close Price 23,01 AUD
Spread / Highest target 17,3%
Spread / Average Target 0,68%
Spread / Lowest Target -34,2%
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NameTitle
Shayne Cary Elliott Chief Executive Officer & Executive Director
Paul Dominic O'Sullivan Chairman
Michelle Jablko Chief Financial Officer
Gerard Florian Group Executive-Technology
Paula Jane Dwyer Independent Non-Executive Director