ANZ Group's Strong Cash Position Offsets Increase in Provisions, Jefferies Says

MT Newswires Live11-11

ANZ Group's (ASX:ANZ) move to increase provisions against future loan losses is offset by its strong capital position, Jefferies said in a note on Monday, noting that the bank's balance sheet stands rectified.

ANZ reported Monday fiscal 2025 revenue of A$21.90 billion, slightly below Jefferies' estimate of A$21.92 billion.

The competitive environment has had a relatively modest impact on sector net interest margins (NIM). While non-interest income remains a headwind due to muted fee and commission activity.

"In our view, the next step in improving performance will be to reverse the revenue momentum of the business, where subsystem growth has been accompanied by NIM underperformance compared to peers," said an analyst at Jefferies.

Achieving improved revenue momentum will be challenging for the bank in light of its planned 3,500 job cuts by the end of fiscal year 2026, it added.

The brokerage maintained its Hold rating but raised price target to A$33.19 from A$31.6.

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