ANZ Banking Group chief executive Mike Smith had a 16 per cent pay cut in fiscal 2009 to $10.9 million, but the bank says he actually received half that amount.

The bank’s annual report released on Monday shows Mr Smith’s total remuneration for the 12 months to September 30 was valued at $10.935 million, down from $12.963 million in the previous year.

The sum included a rise in short term incentives (STIs) to $4.5 million, up from a $2.4 million STI payment in the previous year.

“The CEO’s STI payment for the 2009 year has been determined having regard to both the company’s underlying profit for the current year as well as the significant progress achieved in relation to ANZ’s long-term strategic goals,” the report said.
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ANZ Banking Group Ltd chief executive Mike Smith says he cannot guarantee future increases in lending rates won’t exceed those made by the Reserve Bank of Australia (RBA).

Echoing comments made by National Australia Bank (NAB) chief Cameron Clyne, Mr Smith said on Thursday he could not promise not to move the bank’s interest rates out of step with moves to the official cash rate.

Media reports earlier this week were incorrect when they said Mr Smith had pledged to keep the bank’s interest rate moves in lock-step with those of the RBA, the ANZ chief told analysts after unveiling the bank’s annual profit result on Thursday.

“I said I would be reluctant to move (rates) beyond a (RBA) rate increase,” Mr Smith said.
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The ANZ Bank has promised not to slug its 800,000 home borrowers with variable interest rate rises above official moves by the Reserve Bank.

The pledge, made by chief executive Mike Smith in an interview with the Herald Sun newspaper, follows warnings from Treasurer Wayne Swan that independent rate increases by the major banks could not be justified in the current economic climate.

The paper says the ANZ is the first of the big banks to confirm it will not deviate from the RBA rate cycle until it becomes clear that Australia has recovered from the global economic downturn.

“I would be reluctant, frankly, to do anything until we really have to,” Mr Smith said.
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Australia’s banks could begin hiking interest rates on variable mortgages before the central bank raises official rates, if funding costs stay high, the head of the nation’s fourth largest bank says.

ANZ Banking Group Ltd chief executive Mike Smith also on Wednesday said he could not rule out making an offer for the banking arm of Suncorp-Metway Ltd, although plans to acquire the business “were not on the radar” at present.

Mr Smith said wholesale funding costs may determine whether the big four lenders - Westpac Banking Corp, Commonwealth Bank of Australia Ltd, National Australia Bank Ltd and ANZ - raise their variable rates before the RBA initiates its own increase, which economists say could occur in early 2010.

“I think that funding costs and the official rate is irrelevant,” Mr Smith told reporters after delivering a speech at an Australian British Chamber of Commerce function in Sydney.
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ANZ Banking Group Ltd chief executive Mike Smith says he remains confident in the bank’s bid for the Asian assets of the Royal Bank of Scotland (RBS).

And, if successful, the deal would be earnings per share (eps) accretive within three years, he said.

“In the short term, there will be a slight negative affect (on eps) and in the medium term, I mean about three years,” Mr Smith told reporters in Melbourne when asked when eps would become accretive.

“I am confident there will be quite a few opportunities (in Asia), ” he said, adding that there would also be further acquisition opportunities in Australia.
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ANZ Bank chief Mike Smith has warned mortgage holders not to fix home loan rates yet, saying interest rates may continue to fall.

Mr Smith, attending the Australian Institute of Company Directors in Brisbane on Thursday, was asked if the cash rate could go any lower than its current 49-year low of three per cent.

“Yes, I do. I think it can. I think it depends very much on what happens in the next few months,” Mr Smith said.

“The great thing that Australia has is room to move.”
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ANZ Banking Group Ltd chief executive Mike Smith says he expects the bank’s revenue to continue to rise, but has warned bad debt provisions will also increase.

“Basically revenues are likely to continue to increase but we will have an increase in provision charge so therefore one has to offset the other,” Mr Smith told ABC Television on Sunday.

Mr Smith said he expected provisions to be around $1.4 billion to $1.5 billion over the coming half years.

“We’re really saying we’ve got four halves where provisions are about the $1.4, $1.5 number billion.”
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The world’s beleaguered financial markets are slowly recovering from the doldrums of the economic downturn, ANZ chief executive Mike Smith says.

But it does not necessarily mean banks will pass on to borrowers further cuts in official interest rates, he warned.

Despite ANZ reporting a 28 per cent plunge in first-half profit on Wednesday due to bad debts and losses on derivative trades, Mr Smith said the worst was behind the financial sector.
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ANZ Banking Group Ltd has reported a sharp fall in first half profit and says tough market conditions will continue over the rest of fiscal 2009 and into fiscal 2010.

Net profit for the six months ended March 31 fell 28 per cent to $1.417 billion, from $1.963 billion in the previous corresponding half, after charges for bad debts and funding costs rose.

Cash profit, adjusted for one-off items and movements in derivatives, fell 43 per cent to $954 million.

Total credit impairment charges rose 28 per cent to $1.435 billion, from $726 million in the previous first half and was up four per cent from $1.364 million in the second half of fiscal 2008.
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ANZ Banking Group Ltd says its provisions for the fiscal 2009 year are expected to be higher than last year and in line with market expectations.

The bank said volatility in global credit market continues to impact, and that it has taken a further mark to market charge of $370 million in the year to date.

It also flagged an “appropriate” cut to its fiscal 2009 dividend of about 25 per cent.

But its underlying business performance remains resilient, with strong revenue trends in a number of its operations, ANZ said in a market update on Thursday.
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ANZ Banking Group Ltd chief executive Mike Smith is eyeing expansion opportunities in Asia and encourages other Australians to do the “blindingly obvious” amid the global financial crisis.

“I can certainly see a few potential opportunities among Asia’s financial companies,” Mr Smith told journalists on Friday.

“The importance of Asia to Australia is so blindingly obvious.

“The whole economy is now geared towards Asia, we just have to play our part in that.”
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ANZ Banking Group Ltd (ANZ) has budgeted $100 million in its fiscal 2009 year for costs relating to job cuts and completing its corporate restructure.

Chief executive Mike Smith flagged that more job cuts were on the horizon as the bank moved to implement its already announced policy of shedding layers of middle management from 13 to seven.

“That inevitably will have some fallout,” he told media after ANZ unveiled its 2008 result this morning.
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ANZ Banking Group Ltd (ANZ) chief executive Mike Smith said it would take the world between two and three years to work through the current financial crisis.

“Markets will remain volatile and skittish,” Mr Smith told analysts after the bank reported its 2008 result today.

Mr Smith said Australia was unlikely to see a recession and the bank expects Australia’s economy to grow by 1.8 per cent in 2009, New Zealand to grow by 0.5 per cent and Asia (excluding Japan) to grow by almost seven per cent.

“The worst of the shocks will subside by the end of the year,” he said, adding that the global financial crisis was “unprecedented”.
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Big four lender, ANZ Banking Group Ltd, has seen its profit drop for the first time in a decade after suffering a $1 billion loss on bad debts triggered by turbulence in global financial markets.

The seven per cent slide in half-yearly earnings to about $2 billion, comes despite ANZ, Australia’s fourth biggest lender, having hiked its interest rates beyond moves in the official cash rate several times this year.

It is the trans-Tasman giant’s first profit slide since 1998, suggesting the fallout from the global credit crunch is impacting the broader local economy.
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