ANZ posts record profit on expanding China business

The Australia and New Zealand Banking Group Ltd reports a record profit of US$3 billion in its first-half ending March.

Profits rose 10% in the first-half driven by strong growth in the bank’s institutional business in Greater China (China, HK and Taiwan). Revenue jumped some 24% in the six months to March 31 year-on-year.

"Our China business is on the right track...both onshore and offshore," said Chief Executive of ANZ China, Dr. Charles Li.

ANZ is the first Australian bank to get official permission to use the yuan in its retail operations. Li said the bank’s strong connectivity made China a strategic market and key to its aim of becoming a super-regional bank.

Growth also came from the bank’s growing Asian portfolio and amid weak margins in Australia. CEO Mike Smith said weak credit demand and tightening margins had shrunk domestic earnings despite interest rate cuts.

"These challenges are now an ongoing part of the Australian banking landscape,” he noted.

ANZ is the fourth largest bank in Australia and the largest bank in New Zealand.