Retail life claims hampers ANZ Wealth
ANZ’s Wealth Australia has reported a decrease in net funds management and insurance income as a result of adverse retail life claims experience.
The 2017 Annual Review showed a decrease of $163 million due to adverse retail life claims experience, and a one-off experience loss due to the exit of a group life insurance plan. This was partially offset by reinsurance profit share and favourable claims experience in Lenders Mortgage Insurance.
Funds management income decreased as a result of the strategy to rationalise the legacy portfolio to SmartChoice, which the bank said was a lower risk model. This was now complete.
“Operating expenses decreased due to productivity initiatives that resulted in a reduction in FTE (full-time equivalent), partially offset by inflation and higher regulatory compliance and remediation spend,” the review said.
This led to an $86 million decrease in cash profit from prior year, a reduction of 27 per cent.
The bank reduced full-time equivalent staff by four per cent, including a six per cent reduction in senior management as a result of a reshaping of the organisation.
There were now 44,896 full-time equivalent employees, down from 46,554 in 2016.
The bank’s statutory profit was $6.4 billion, up 12 per cent, while cash profit (which excludes non-core items from statutory profit), was $6.9 billion, up 18 per cent.
The final dividend of 80 cents per share brought the total to 160 cents per share fully franked for the year, unchanged from 2016.
“This reflects a dividend payout ratio of 68 per cent of cash profit with $4.6 billion in dividends paid to shareholders, moving ANZ closer to our target fully franked payout ratio of 60-65 per cent of cash profit,” the review said.
AUTHOR
Malavika Santhebennur
Recommended for you
With BlackRock recently combining both private and public markets in a single managed account for US investors, commentators explore the challenges and opportunities of doing so in Australia.
PM Capital has hit out at Platinum Asset Management, saying the firm only provided “limited engagement” following its bid for two listed investment companies.
Platinum Asset Management has seen outflows moderate during March, down 15 per cent from the previous month when it announced two major investment team changes.
Two listing experts have shared tips for fund managers to consider when it comes to launching their first ETF on an exchange.
