Higher returns support interim dividend
ANZ grew profit and raised its dividend in the first half, even as it set aside more funds to cover risks tied to the Middle East conflict.
The bank reported a statutory profit of $3.65 billion for the half year ended 31 March 2026, with cash profit at $3.78 billion. That marked a 70% increase from the previous half, or 14% higher excluding one-off items. Return on tangible equity rose to 11.6%, while its Common Equity Tier 1 ratio improved to 12.39%.
ANZ’s board proposed an interim dividend of 83 cents per share, with franking lifted to 75%. The bank said this was supported by stronger performance in its Australian operations.
“This half year result demonstrates three things. First, our transformation is running at pace, and we are making good progress in executing our five immediate priorities safely, sustainably, and on time. Second, in parallel, we are investing in line with our ANZ 2030 strategic initiatives, to deliver for our customers, accelerate growth and outperform the market beyond 2027. Third, importantly we are already delivering materially better returns for shareholders,” ANZ chief executive officer Nuno Matos said.
The bank linked its higher profit to efforts to simplify operations and reduce duplication, alongside improvements in key measures such as its cost-to-income ratio, which stood at 49.4%.
Across its divisions, ANZ said Institutional and New Zealand operations performed steadily, while changes in its Australia Retail and Business & Private Bank businesses remained in progress. Lending and deposit growth was moderate, and margins held steady despite competition.
Credit quality remained stable. Individual provisions fell to $148 million, down $20 million from the previous half, with non-performing exposures easing slightly to 0.55% of total credit.
At the same time, ANZ increased its collective provisions, booking a $126 million charge that included a $175 million buffer for potential impacts from the Middle East conflict. Its total collective provision balance rose to $4.45 billion.
Matos said the broader environment remained uncertain, particularly as global conditions shift: “Much of the potential impact of this crisis remains ahead of us, but the longer the flow of oil is constrained, the greater the chance the crisis shifts from being primarily an inflation challenge, to much more a supply and growth challenge.”
The bank said it had not seen a material change in customer borrowing behaviour, and that households in Australia and New Zealand generally remained financially resilient.
Liquidity and funding levels stayed above regulatory requirements, with a liquidity coverage ratio of 132% and a net stable funding ratio of 115%. ANZ also issued $15.5 billion in term wholesale debt during the half.
Matos said the bank would continue focusing on its long-term strategy.
“The result announced today confirms our actions to reset the bank are working, but we have more to do. As we look ahead, we continue to focus on executing our ANZ 2030 strategy as we progress our five-year journey to be the best bank for customers and shareholders in Australia and New Zealand.”
