CHAIRMAN’S REPORT
A message from Paul O’Sullivan
Along with your Shareholder Update covering the First Half 2021 Financial Results
I’m pleased to enclose details of the Interim Dividend payment of 70 cents pershare. This dividend is double that of the Final Dividend FY20.
ANZ reported a Statutory Profit after tax for the Half Year ended 31 March 2021 of$2,943 million, up 45% on the prior half.
This half, Cash Profit increased 28% on the prior half reflecting the strength of ourdiversified franchise, management actions and the improved economic outlook on
credit provisioning. Core banking revenue increased 3%; Markets income while strong
was lower half-on-half as market volatility and customer activity normalised. We wereonce again disciplined on costs and continued to invest for the future.
ANZ’s Common Equity Tier 1 Ratio, a measure of the bank’s
capital position, increased to 12.4% while Cash Returnon Equity increased to 9.7% from 7.6% in the prior half.
Earnings per share increased 27% to 105 cents per share.

Credit conditions were favourable with a net credit
provision release of $491 million. This was comprised ofcollective provision (CP) release of $678 million and an
individually assessed provision (IP) charge of $187 million.

Our interim dividend this year will see almost $2 billion
paid to shareholders and we have maintained our capitalratios significantly above the Australian Prudential
Regulation Authority’s ‘unquestionably strong’ benchmark.

The CP release was a result of the improving economic
outlook as well as some loan volume reductions. The low
IP charge reflected the positive impact of government andbank support packages as well as our disciplined focus on
customer selection in Institutional.

We also announced we would again apply no discount to
the Group’s Dividend Reinvestment Plan (DRP) and would
neutralise the impact of shares allocated under the DRP.
Performance

We know uncertainty remains however and our Collective
Provision balance is more than $900 million above
pre-COVID levels at $4,285 million.

The actions taken by the Board and management overthe past five years to simplify and strengthen the Group
had us well placed to manage the impact of the COVID-19
pandemic on our business and our customers.

COVID-19 Response

We went into the pandemic in a strong position. Despite
the uncertainty we did not need to raise capital by diluting
existing shareholdings and unlike our major competitors
we have actually reduced the number of shares on issue
over the last few years.

India, a country in which we have a large anddedicated workforce, has been particularly hard hit. The
management team has responded by providing our staﬀ inIndia with as much support as possible and they remain in
our thoughts.

That strength has also meant we have been able tosupport our customers through one of the most difficult
periods in generations.

Closer to home the situation is more stable. Whilecontinued lockdowns will need to be carefully managed,
the economy is starting to recover strongly as businesses
are more confident with the outlook. Government support
has been critical in the recovery.

While it has been a challenging period, all parts of thebusiness performed well.
In Australia we grew in our targeted segment of residential
housing owner occupiers and regained our place as thethird largest lender. To put this into better perspective, weadded more than 92,000 new home loan accounts during
the half in Australia.
It was a similar story in New Zealand where we grewfaster than the market and remain firmly in the number
one position. We are in a robust position in New Zealandand remain well placed to manage the increased capital
impost required by the Reserve Bank of New Zealand.
Customer revenue in our Institutional business was solid
while trading income in our markets business reduced
after an exceptional 2020. Net interest margins were up
during the half and this oﬀset lower lending volumes.

While Australia and New Zealand have both managed
the pandemic well, the experience of some of our closest
neighbours demonstrates the fragility of the situation.

The coordination between governments, industry andregulators has meant our customers are in a far better
position today than they would have been without thiscooperation.
Finally, I would like to acknowledge our people across ournetwork. The Board is deeply appreciative of how they
supported customers even at a time when many of ourstaﬀ had been personally impacted.

PAUL O’SULLIVANCHAIRMAN

2021 HALF YEAR HIGHLIGHTS
100%$2,990 million

70 cents

2H20

2H20

CASH PROFIT(Continuing operations)$2,345 million

27%

105 cents

DIVIDEND PER SHARE

CASH EARNINGS PER ORDINARY SHARE(Continuing operations)

35 cents

2H20

83 cents

Note:
All figures are on Cash Profit (Continuing operations) basis, adjusted to exclude non-core items within Statutory Profit and discontinued operations.
Growth rates refer to 2021 First Half compared to the 2020 Second Half (2H20).

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