Australia and New
Zealand Banking Group posted strong full year results in its wealth management
businesses outside of Australia today, bolstered by the completion of the acquisition of Royal Bank of
Scotland’s Asian wealth businesses.
Against the backdrop
of a solid profit of $5.36 billion for the entire bank, ANZ Wealth in Asia,
Europe and Americas saw revenues rise 18 per
cent year on year. Expenditure was up 15 per cent year on year, with savings
from the RBS transition being reinvested to grow revenue, according
to the bank’s full year results.
The cost to income ratio for the business also improved,
declined from 81 per cent to 79 per cent during 2011.
The bank has been
investing heavily in its Asia wealth business this year, and is aiming to
derive up to 30 per cent of revenues from the Asia-Pacific region by 2017. The
wealth management division invested $50 million this year, which included
opening a Mumbai branch in June and a Chongqing branch in March.
investment for IT and operations infrastructure focused on major programs such
as Transactive Asia (cash management), the core banking system and global markets sale distribution platforms.
successful integration of the businesses acquired from RBS (in 2009) has supported the
strong performance of retail and wealth. The repositioning of the businesses
toward the affluent and emerging affluent segments is also now complete,” said
However, in the bank’s
home market in Australia, by far its largest division, the results were not so good. ANZ Wealth’s post-tax
profit in its Australian wealth management unit fell 16 per cent over the last
ANZ Wealth Australia post-tax profit fell
from $412 million in September 2010 to $345 million in September 2011.
A volatile market,
negative investor sentiment and increased insurance costs caused by
catastrophic weather events, were to blame for the fall. Strong new business
growth was apparently offset by adverse general insurance claims around the
Queensland floods, Hurricane Yasi and New Zealand earthquakes.
But despite the profit falls, Australia's fourth largest lender
has announced plans for
expanding the ANZ Wealth division in its home market.
"We are improving
our Wealth proposition and enabling greater presence for the wealth management
and insurance offerings within bank branches and online (eg, EasyProtect, 50+
Life)," said the firm.