Steve Targett on creating a different Institutional bank
"Every bank talks about understanding its clients. What
we are trying to do differently in Institutional is to
become active partners with our clients, understanding
and catering to their business in ways they might not
normally expect of their bank. In taking this approach, we
believe we can also create a whole new dimension
of job satisfaction and personal challenge for our staff.
There are three main differentiators for us: our Asian
network, the CEO Agenda, and our strategic partnership
with the World Wildlife Fund.
Through the CEO Agenda, we strive to be active partners
to our clients in their strategic thinking, offering innovative
approaches to their issues, and committing our multi-skilled
team to join forces with their senior team.
Supporting this approach is our CEO Journal, produced
in partnership with the Australian Graduate School
of Management, covering the big issues facing top
executives today.
Our staff enjoy the difference that ANZ is now making with
Institutional clients. Our clients responded by voting
us Number 1 Lead Bank in the Peter Lee survey, with
ANZ winning an unprecedented 16 of 22 categories."
We also bring to our clients the fruits of our collaboration
with World Wildlife Foundation, our partner in building
sustainable finance. The policies and initiatives we are
developing with WWF will inform corporate decisions
about how to achieve optimal business performance
while understanding the impact on our fragile planet.
As the seventh largest network bank in Asia, we
offer our clients the vision and scope of Australia’s
leading bank in Asia, with a local knowledge that
no Australian competitor can match.
Our financial performance
($m)
2005
2006
%
Income
3,077
3,329
8%
Operating Expenses
(1,154)
(1,283)
11%
Profit before Provisions
1,923
2,046
6%
Provison1
(136)
(58)
(57%)
Tax & OEI
(529)
(592)
12%
Profit after Tax
1,258
1,396
11%
Cost to Income(CTI)
37.5%
38.5%
-
Staff
5,318
5,675
7%
1 Provision for Credit Impairment
Institutional delivered a good result this year,
with earnings up 11%. Each of our businesses
delivered growth above 10%, with the exception
of our Debt Product Group, which has been
impacted by highly competitive lending margins.
Revenue growth of 8% was within the Group’s
target range. Driving this growth was a 14%
increase in average lending assets and a 15%
increase in average deposits.
We have continued to invest in our business,
particularly in our people and product capability,
which resulted in expenses increasing 11%.
During the year we added more than 350 staff,
and the competitive market for quality staff
resulted in a significant increase in staff costs.
Credit quality remains very good, and as a result
the provision for credit impairment fell from
$136 million to $58 million.
