CEO’s Message

The core of our strategy has not changed. Put simply, we will generate decent returns by improving the financial wellbeing of our customers.

This year we continued to focus on balance sheet strength, improve our culture, simplify the business and rebuild our team’s capabilities. In doing this, we significantly reduced the cost and risk of operating the bank despite the strong headwinds facing the sector.

We are determined to have the right people who listen, learn and adapt. We will put the best tools and insights into the hands of our customers and people. Importantly, we will concentrate our efforts on those particular things that add value to customers – and do them right the first time.

This means we must continue to simplify our business, improve our customer proposition and invest in innovations that deliver better customer outcomes and improve the efficiency of our operations.

The Royal Commission highlighted many failures the Australian banks needed to quickly remedy. ANZ is not immune from this challenge.

This year we announced an additional charge of $682 million as a result of an increase in our provisions for remediation work. We know this is real money and has a real impact on shareholders. But we also know it’s important to fix the mistakes of the past and return money owed to customers as quickly as possible.

We are currently resolving identified fee or interest discrepancies with over 3.4 million Australia Retail and Commercial customers. To date our Responsible Banking team has remediated over one million customer accounts.

If there is a positive from this work, it is that much of the time and resources being invested in remediating our systems and processes will make us a better bank for our customers and shareholders.
It means the mistakes of the past are unlikely to be repeated and when issues arise they will be easier to fix.

Our purpose of shaping a world where people and communities thrive guides our decisions. An example of this is the program we have in place to proactively contact more than one million customers to help them get more value from our products and services, including those eligible for Centrelink or Veterans’ Affairs benefits or those with persistent credit card debt. This is to make sure customers are using the best products given their individual circumstances and that they are aware of all the options available.

Another issue we care about is providing affordable and sustainable housing for Australians and New Zealanders. We do this by encouraging investment in the sector – including our role leading the largest social bond issuance for housing in Australia.

This year we introduced wide-ranging reforms to the way we pay people. Variable remuneration is now a smaller part of our people’s take-home pay and these reduced bonuses are determined by the overall performance of the bank.

This is not about paying our people less. It is an industry-leading initiative that will positively enhance our culture and become an important point of differentiation. It also addresses the negative impact an over-emphasis on individual bonuses within a bank can have on customers and the community.

Redesigning how we reward our staff was one of the 16 key initiatives we announced as part of our initial response to the Royal Commission recommendations. As part of this, we also strengthened our accountability frameworks to ensure there are appropriate consequences for the small number of people who do not meet standards of behaviour or performance.

Finally, despite this difficult environment, we have made good progress this year and I’d like to thank the more than 39,000 people who turn up for ANZ and work hard every day for our customers. I’m confident we have the right strategy and team to deliver great, sustainable results in the future for our customers, our shareholders and the community.