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ANZ bad loan charges soar; underlying profit rises

ANZ Bank's New Zealand operations have seen their profits plunge as charges for bad loans jump and their share of the mortgage market continues to erode.

Tuesday, September 1st 2009, 5:22AM

by Jenny Ruth

The local branch and subsidiary, ANZ National Bank, combined saw net profit for the three months ended June plunge 75% to $56 million, the branch's latest general disclosure statement shows.

However, that reflected a $244 million increase in its charges against profit for bad loans in the three months. Net interest income for the quarter was actually up 15.8% to $579 million.

That increase included increasing its charge to meet its obligations in the ING Diversified Yield and ING Regular Income Funds from $116 million at March 31 to $147 million at June 30.

ANZ's profit for the nine months ended June was down 43% to $478m with charges against profit for bad loans totaling $532 million. Only $122 million of these charges related to mortgages while another $102 million related to other retail exposures.

The bank's net interest income for the nine months rose 16.3% to $1.77 billion.

The subsidiary, ANZ National Bank, increased its mortgage book by $281 million in the June quarter but, using Reserve Bank figures as a proxy for the market, its share of new mortgage lending by registered banks amounted to just 15.9%.

That meant its share of the market eased from 28.71% at March 31 to 28.56% at June 30.

ANZ's New Zealand branch's mortgage book stood at $4.52 billion at June 30, down from $4.77 billion three months earlier, suggesting the branch's share of the market fell from 3.03% to 2.84%.

The figures on the branch's mortgage book aren't directly comparable with those of the subsidiary because the branch's numbers are prepared under Basel 1 rules and include business loans secured against housing. The subsidiary's figures are prepared under Basel ll rules and don't include business loans secured against housing.

ANZ established the New Zealand branch in January to get around Australian prudential rules preventing an Australian bank from lending more than 50% of its equity to a subsidiary.

The subsidiary's GDS shows it had a further $5.64 billion in off-balance sheet retail mortgages, generally loans approved but not drawn down. Of the total book, 21.6% had loan-to-value ratios (LVRs) above 80%, down from 22.3% at March 31 and 26.3% at December 31.

Loans with LVRs above 90% eased marginally to 10.2% of the book from 10.5% at March 31.

 

« Westpac's profit plummetsBNZ makes loss on tax case; mortgage book grows strongly »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.45 7.05 6.85
ANZ 8.64 7.99 7.49 7.35
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.39 6.89 6.75
ASB Bank 8.64 7.39 6.89 6.65
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - ▼7.29 ▼6.85 ▼6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 ▼7.89 ▼7.45 ▼7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 7.15 - -
Co-operative Bank - Owner Occ 8.40 7.35 6.89 6.75
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.85 7.39 7.25
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.69 6.45 6.19
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.85 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.59 7.29
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 8.35 7.89 7.65
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 7.35 6.89 6.75
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.90 7.39 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.30 7.89 7.69
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.30 8.89 8.69
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.95 7.45 7.29
SBS Bank Special - 7.45 6.95 6.79
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 7.05 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 8.19 7.55 7.55
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 7.39 6.75 6.75
Unity 8.64 6.99 6.85 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 7.15 6.85 -
Westpac 8.64 7.89 7.49 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.89 6.65
Median 8.64 7.45 7.37 6.77

Last updated: 26 February 2024 9:10am

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