NZ shows bank chiefs the way

By KEVIN TAYLOR

ANZ Banking Group's New Zealand division yesterday posted a 31 per cent rise in net profit - outperforming its Australian parent.

The group's after-tax profit in the September year was a record $A1.8 billion ($2.3 billion), up 7 per cent.

But ANZ's New Zealand operation, which contributes 15 per cent of the total group's business, was even more profitable.

ANZ New Zealand increased its after-tax and abnormals profit by 32 per cent from $A210 million ($266 million) to $A278 million ($347 million).

Operating income for the year was $A895 million ($1.11 billion), up from $A813 million ($1.03 billion).

ANZ New Zealand managing director Murray Horn said he did not think any other year had been as good.

He said the division's cost-income ratio was better than the bank's overall.

"I've been here now for nearly four years and one of the personal things I really wanted to achieve was to get that better than the Australians. We started off a long way behind," said Dr Horn.

"The business is in great shape. If you look at the efficiency measures - the cost of generating a dollar of revenue - we are now world class, which is great for a New Zealand business."

His prime focus now was on improving personal customer satisfaction.

Measures were in place to improve that, including a customer charter and surveys.

Increased fee income and higher net interest income were among the main influences on the result.

New Zealand staff numbers fell 6 per cent from 3918 to 3683 in the year.

Dr Horn said the lower staffing was a consequence of improved efficiency, customers moving to electronic transactions, and new technology.

Growth in fees - to $A296 million ($370 million) for the year from $A273 million ($346 million) last year - was due to a strong result from corporate financing, higher transaction volumes and a bigger contribution from the cards business.

ANZ shares closed on Wednesday at $A17.49 on the Australian market, up 18c, just 5c short of an all-time high.

On the NZ Stock Exchange the shares closed on Wednesday at $21.05 and ended yesterday 25c higher.

Group chief executive John McFarlane said the rise in profits came amid the global downturn and a string of corporate collapses in Australia.

Provision for doubtful debts had increased to reflect the risk arising from global economic uncertainty and the September 11 terrorism attacks.

The group will pay a final dividend of 40Ac a share for the second half (35Ac last year), making a return for the full year of 73Ac a share.