Category: ANZ

The scams module is available to more than 8,000 accredited MoneyMinded coaches in Australia and builds on ANZ’s ongoing work to grow awareness of scam threats in the community.

ANZ Head of Social Impact and Community Partnerships Janet Liu said: “Scams continue to present a significant threat to the financial wellbeing of Australians. Through our new MoneyMinded scams module, we hope to further inform and educate people by providing practical skills that can assist them to stay ahead of cyber criminals.”

The MoneyMinded scams module includes practical lessons in spotting scams, and how people can protect themselves and access support.  Lessons are delivered through animation, prompt cards, guided coaching and participant handouts.

It outlines various scam types such as investment scams, dating and romance scams, phishing scams, remote access scams, and employment scams.

MoneyMinded is ANZ’s flexible financial education program designed to help adults enhance their money management skills, knowledge and confidence. Eligible community professionals can enquire to become accredited MoneyMinded Coaches, using the program to educate their clients. Since launching, more than 250 MoneyMinded coaches have already been trained to use the new module.

ANZ controls prevented more than $100 million of customer funds going to cyber criminals in the twelve months to March 2024. 

ANZ’s customer protection teams and systems operate 24/7. Customers who believe they may have been a victim of a scam should contact us immediately, on 13 13 14 or visit us at http://www.anz.com.au/security/report-fraud/ for more information.

For more information on the MoneyMinded program visit: https://www.anz.com.au/about-us/esg/financial-wellbeing/moneyminded/

These changes include:

• Previously advised model reviews of mortgage risk weights have now been approved by both APRA and RBNZ. Once fully implemented, the benefit of these model changes will be a ~$22bn reduction in Advanced Internal Ratings Based Risk Weighted Assets.
• On 26 June, APRA released amendments to its capital framework which come into effect on 30 September. APRA has subsequently approved ANZ’s application of this revised framework (APS 112).

The net benefit of these methodology and prudential changes will be ~30 basis points (bps) of Level 2 CET1 by 30 September 2024.

In addition, ANZ disclosed on 9 July it expects the impact of the Suncorp Bank acquisition to result in a reduction of 105 bps in Level 2 CET1. This represents an improvement of approximately 18 bps relative to the pro-forma estimate announced at ANZ’s half year results in May.

Further details are included in the charts attached. Given the complexity of this disclosure, ANZ will host an analyst and investor briefing at 2pm AEST with ANZ’s Group Treasurer and its Group General Manager Risk Metrics & Measurement. Details will be distributed separately.

ANZ Economist, Madeline Dunk: “ANZ-Indeed Australian Job Ads recorded its sixth consecutive monthly decline in July, with the series down 16.7 per cent since January. This points to continued cooling in the labour market.”

“We’ve also seen the share of employers recruiting fall sharply in June to levels last seen during the east coast 2021 lockdowns, while average hours worked per employed person has declined 30 minutes a week since February 2023. Taken together, there is a risk the labour market could slow more sharply than we and the Reserve Bank of Australia are forecasting.”

Indeed Senior Economist, Callam Pickering: “In July, the decline in ANZ-Indeed Job Ads was once again concentrated in Victoria and New South Wales. Falls in other states were more modest. The nation’s two most populous states account for around 86 per cent of the total decline in Job Ads over the past year.

Recent declines in Job Ads have reflected reduced demand in education, food preparation & service and nursing. Over the past three months, Job Ads have fallen for 57 per cent of occupational categories. Among those bucking the national trend, with Job Ads rising, have been physicians & surgeons and banking & finance.

“ANZ-Roy Morgan Australian Consumer Confidence recorded another decline for a second consecutive week, following a six-month high a fortnight ago,” ANZ Economist Sophia Angala said.

“Weekly inflation expectations rose 0.1 points to 5.1 per cent despite second quarter Consumer Price Index data printing largely in line with the RBA’s expectations, alleviating concerns around a potential cash rate hike. This would usually be a positive for consumer confidence. However, coverage of the heightened recession concerns in the US over the weekend may have offset this.

“The positive impact of Stage 3 tax cuts appears to be waning, driven by a 4.9 point drop in households’ confidence in their own financial conditions over the next 12 months, one of the largest weekly falls for this subindex in 2024 so far. However, the boost to disposable incomes from the tax cuts may still be supporting the ‘time to buy a major household item’ subindex, which lifted

1.3 points last week.”

ANZ Chief Executive Officer Shayne Elliott said: “Today is an exciting day for the ANZ Group, as we complete our acquisition of Suncorp Bank.

“This strategically important acquisition boosts our presence in Queensland, adds scale to our Retail and Commercial businesses, and means we can compete more effectively across the Australian market.

“Tomorrow we will welcome the roughly 3,000 strong Suncorp Bank team and their 1.2 million customers into the ANZ Group.

“Suncorp Bank customers will continue to receive the same great service, from the same exceptional Suncorp Bank staff. Over time, we will make available to them ANZ’s newest technology, giving them access to the very latest in banking services.

“Our acquisition demonstrates our commitment to Queensland and Queenslanders. We look forward to playing our part to help Queensland to continue to grow and prosper,” Mr Elliott said.

Completion of the acquisition follows the commencement of Queensland legislation amending the Metway Merger Act today, approval of the acquisition by the Federal Treasurer on 28 June 2024 and authorisation under Australia’s competition laws by the Australian Competition Tribunal on 20 February 2024.

• Consumer confidence eased 1.3pts last week to 83.1pts but is still 4.6pts higher than a fortnight ago. The four-week moving average rose 0.4pts to 81.3pts.

• ‘Weekly inflation expectations’ was unchanged at 5.0%, while the four-week moving average fell 0.1ppt to 5.0%.

• ‘Current financial conditions’ (over last year) decreased 0.6pts, while ‘future financial conditions’ (next 12 months) rose 0.5pts.

• ‘Short-term economic confidence’ (next 12 months) fell 4.4pts and ‘medium-term economic confidence’ (next five years) fell 0.9pts.

• The ‘time to buy a major household item’ subindex declined 1.1pts.

The update concerns three separate but related matters: data reporting processes; allegations around a 2023 bond transaction; and conduct and behavioural matters primarily within its Sydney dealing room.

ANZ Chief Executive Shayne Elliott said: “With the assistance of external counsel, we are investigating these issues with the urgency expected and the Group Board continues to supervise this work closely.

“We have been very clear with our people. Where we find any evidence of wrongdoing, those involved will be held accountable and action will be taken. The Board will also lead a process to ensure consequences will be applied to senior executives, both past and present, including myself, where appropriate” Mr Elliott said.

Data reporting

ANZ advised the Australian Office of Financial Management (AOFM) in August 2023 it had submitted incorrect monthly secondary bond turnover data for the FY22-23 year. This error came to light before the required year-end sign-off on the accuracy of the data supplied. 

Data errors were caused by a range of issues including process and data extraction errors on ANZ’s part. This resulted in the incorrect inclusion of transactions that should have been omitted as well as double counting of some transactions. 

ANZ acknowledges this is an unacceptable failure. It is also investigating whether it should have reported this issue to the Australian Securities and Investments Commission (ASIC) earlier than it did and will engage with ASIC further on this matter.

Mr Elliott said: “We have also reviewed recent data submissions provided to relevant customers and although there will be ongoing work, we don’t believe we have material issues with the data we have submitted.

“However, as an additional precaution, I have asked our internal audit team to review the governance and control frameworks supporting the production of similar submissions to customers and report its findings to the Board.

“I have personally apologised to the Chief Executive at AOFM for ANZ’s failures. We are significantly enhancing our governance process around this data, including building a separate validation tool and increasing training for relevant staff. We had already strengthened our breach reporting process through system improvements,” Mr Elliott said.

 

ASIC investigation into AOFM transaction

 

As previously advised, ASIC is investigating ANZ’s execution of a 2023 issuance of 10-year Treasury Bonds by AOFM. ANZ is cooperating fully with ASIC’s investigation which is expected to take some months.

ANZ’s external counsel has engaged independent experts to analyse trading data in relation to this issue. This independent experts’ work remains ongoing.

ANZ’s own preliminary analysis has not identified any evidence of market manipulation. ANZ, however, does not have all the information that ASIC has, and this position will be reviewed in coming months.

Conduct and behaviour issues

In addition to our own internal investigation, ANZ has engaged specialist external counsel to investigate allegations of inappropriate conduct and behaviour primarily within the Sydney dealing room.

While the external investigation remains ongoing, there have been employment outcomes for several employees including suspension, termination and a formal warning. Management changes in the Sydney dealing room have also been made.

Mr Elliott added: “My immediate priority is to ensure the investigations are completed in a timely manner, that action is taken against any individuals who have not met the required standards and that the necessary steps are taken to ensure these conduct failures do not re-occur. Importantly, we are not limiting our reviews and will address any conduct that is not in line with our expectations,” Mr Elliott said.

• Consumer confidence rose 5.9pts last week to 84.4pts. The four-week moving average rose 1.0pts to 80.8pts.

• ‘Weekly inflation expectations’ fell 0.1ppt to 5.0%, while the four-week moving average rose 0.1ppt to 5.1%.

• ‘Current financial conditions’ (over last year) increased 5.7pts, while ‘future financial conditions’ (next 12 months) rose 5.3pts.

• ‘Short-term economic confidence’ (next 12 months) lifted 7.6pts and ‘medium-term economic confidence’ (next five years) increased 5.3pts.

• The ‘time to buy a major household item’ subindex rose 5.2pts.

While doing so, our financed emissions included in our emissions reduction pathways for the power generation, oil and gas and thermal coal sectors, have reduced by 25%, 30% and 96% respectively, between 2020 and 2023.

For details on our approach to financing the energy sector, refer to our Energy Customer Approach on our website. Energy Customer Approach explains the words that are underlined as well as providing important information in the disclaimer.

As a member of the Net-Zero Banking Alliance (NZBA), ANZ has committed to transitioning our lending portfolio to align with net zero by 2050.

Our response to the July 2024 Market Forces report is as follows:

1.   Methodology

• While we have significant questions about the methodology of the report, we are not surprised to be mentioned given we are the largest domestic lender to Australia’s energy sector. It’s important to remember this is the most carbon intensive part of our economy and financing its transition to net zero will require significant capital.

• The inclusion of diversified miners and multinational conglomerates oversimplifies the complexity of the transition. Market Forces’ view would suggest that financiers should no longer finance the named companies, some of which are rapidly expanding renewable energy production or producing commodities important for the energy transition.

• ANZ rejects the lack of differentiation between thermal and metallurgical coal. As at September 2023, our exposure at default to coal mining includes exposures to metallurgical (coking) coal used for steel making $0.65bn and thermal coal used for energy generation $0.26bn. We will continue to support our metallurgical coal mining customers as there are no readily available substitutes for its use in steel production at scale. There are several metallurgical coal customers included in our large emitters engagement program who we are engaging with to encourage them to develop their low carbon transition plans.

2.   “ANZ is still Australia’s biggest funder of fossil fuels since Paris.”

• As the largest domestic lender to Australia’s energy sector, the most carbon intensive part of our economy, we want to support this sector’s transition through our financing solutions.

• In addition to our customers in Australia, this includes energy sector customers through our network in NZ, PNG and International.

• We acknowledge oil and gas are still needed as we transition, especially gas as ‘firming’ for renewable energy and in industrial use – considering the intermittent generation of renewables, gas will continue to play a balancing role. We continue to assess the role of oil and gas within the context of the broader energy market, public policy developments and stakeholder and shareholder expectations.

• Our financed emissions included in our emissions reduction pathways for the power generation, oil and gas and thermal coal sectors have reduced by 25%, 30% and 96% respectively, between 2020 and end 2023.

• Since 2015, we have reduced lending provided directly to thermal coal miners by around 85% – it is now around 0.02% of our Group exposure at default. Our exposure to thermal coal miners will continue to decline in line with our target to reduce absolute financed emissions from our lending directly to thermal coal miners by 100% by 2030, and with our existing lending policies detailed above.

• Our remaining direct exposure to thermal coal miners is largely mining rehabilitation bonds, which will continue to be provided to existing customers to ensure their responsibilities with exiting mine sites are fulfilled. We will have completely exited other direct exposures by 2030. As at 30 September 2023, rehabilitation bonds were $169m, which equates to 64.7% of our exposure to thermal coal miners under ANZSIC code 1102.

Additional information:

In 2023, we disclosed progress against our existing pathways in six key sectors and set 2030 targets in two new sectors: Thermal Coal and Transport sub-sectors (Aviation, Shipping and Auto Manufacturing).

This does not currently include targets in relation to ‘facilitated’ emissions such as bonds. However, the updated NZBA guidelines released in March 2024 will require banks to include bonds in targets by November 2025.

We will review our existing – and any new – pathways and targets to incorporate bonds or other relevant facilitated emissions by November 2025.

We have set lending policies for the energy sector, including:

• phase out direct lending to thermal coal miners and coal-fired power plants by 2030
• reduce our exposure at default to upstream gas customers by 40% by 2025 from a 2020 baseline
• not onboard new upstream gas customers or provide lending to new to bank customers that derive more than 10% revenue from thermal coal mining
• not directly finance new or expansion:
  • upstream gas projects,
  • thermal coal mines or extensions to operating life of existing mines,
  • coal-fired power plants

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