In an intriguing move, ANZ omitted any mention of its quarterly profit in a trading update for the December 2021 quarter yesterday.

Two capital management initiatives are on the mind of the ANZ board: a potential Capital Notes offer later this month; and “increasing the size of the current on-market buy-back”.

They key detail disclosed was that the bank’s net interest margin was down 8 basis points for the quarter, with underlying NIM down 5bps.

The impact of rising rates, predominantly in New Zealand, and recent deposit pricing changes are expected to moderate these ongoing headwinds in the second quarter, the bank said.

ANZ said it “has made solid progress in Australia to improve systems and processes for simple home loans with application times now in line with other major lenders” while “efforts continue to improve response times for more complex home loan applications”.

“Given the high levels of refinancing activity in the sector, managing both attrition and margins remain key areas of focus.” The bank also foreshadowed changes to the prices packages offered within its Australian Retail & Commercial business from March 2022, saying they would “provide customers with simpler and lower fee options”. 

“While better aligned to positive customer outcomes, the changes will have a negative transitional impact on other operating income in FY22 of around A$140 million, spread evenly across the two halves.”

The credit environment “has remained benign”, the bank said, with a total provision release of $44 million during the quarter. This comprises a collective provision release of $122 million and an individually assessed provision of $78 million. ANZ announced a $1.5 billion on market buy back in July 2021 and as at 31 January, had bought back $1.0 billion of ordinary shares.