COVID-19 has had a profound impact on all our lives. Whether it is the devastating loss of lives, the crippling of some businesses and impact on livelihoods, limitations placed on social activities and the way we are working – 2020 will be remembered for generations.

ANZ has of course not been spared from the effects of the pandemic. Our full-year statutory profit of $3.6 billion was down 40% – levels not seen since the height of the Global Financial Crisis.

Looking through the immediate impact of COVID-19, the fundamental drivers of our business continued to perform well.

We are fortunate the actions taken by our management team over many years to simplify and improve our operations have the bank well positioned to support our customers as well as supporting economic recovery.

Despite the challenges facing the broader economy, the Board was pleased to declare a final dividend of 35 cents. This is on top of the interim dividend announced in August, taking the total payout to 60 cents per share.

Given the uncertain environment, we put aside $2.7 billion for possible future credit losses. This takes ANZ’s total credit provision reserves to $5.9 billion.

We also continued to simplify the business through the year. On 31 January, we completed the previously announced sale of our OnePath Pensions and Investments business to IOOF Holdings Limited and in September we completed the sale of UDC Finance in New Zealand to Shinsei Bank Limited.

During the most recent quarter, we announced the sale of 1,300 offsite Australian ATMs to Armaguard. While we will continue to operate our 900 ATMs at our branches around Australia, this was another step in achieving our overall goal to be simpler, more efficient and better managed.

Supporting customers

For ANZ, 2020 will ultimately be defined by how we stepped up to support our customers and the community through this devastating global pandemic.

Almost overnight businesses that were once thriving enterprises were restricted from operating, families lost their main source of income and millions faced economic uncertainty, and our thoughts are with those who have been directly impacted.

I’m proud of the way our bank, under the leadership of our Chief Executive Shayne Elliott, has risen to support our customers and I can assure shareholders ANZ will continue to play a crucial role in the economic recovery of Australia and New Zealand.

Already we have provided loan payment deferrals for more than 142,000 home loans and business loans in Australia and New Zealand. This approach has provided customers with the time they need to recover while also protecting the interests of shareholders.

While it’s an impossible task to provide an accurate outlook for the future, I remain optimistic about our prospects given the positive way governments in our key markets, particularly in Australia and New Zealand, have responded to the challenges of COVID-19.

Fortunately, we already are seeing the early signs of recovery, particularly in those parts of our business less impacted by COVID-19. In Western Australia, for instance, our card data shows spending on ‘dining & takeaway’ was up around 18% on the previous year. Clearly there are still more challenges ahead but these early signs provide us with a level of confidence about the actions taken so far.

Executive remuneration

We know how we reward our most senior people is important for many shareholders. The Chair of our Human Resources Committee, Ilana Atlas, AO, has provided more detail in the Remuneration Report. However, I can guarantee shareholders the Board spent a great deal of time evaluating the performance of the management team and deciding how to reward them appropriately.

The Board was pleased with the performance this year and was particularly impressed with the way the bank responded to the challenges presented by COVID-19. However, given the impact the pandemic has had on our shareholders, customers and the broader community, the Board exercised its discretion by applying a 50% reduction to the variable remuneration
for our executive team, including our Chief Executive.

The Board also determined there would be no fixed remuneration increases for any of its Disclosed Executives, including the Chief Executive Officer, for the coming year.

Board succession

As you may know, my time at ANZ came to an end at the finalisation of this year’s result on 28 October. At that date I had been a director for more than 11 years, originally serving between 2002 and 2007, and then returning as Chair in 2014.

Serving as ANZ’s Chairman will always be a highlight of my corporate career. Reflecting on my time here, I am most proud to have played a role in choosing Shayne Elliott to be our Chief Executive and to work with him to establish his talented leadership team. I know I am leaving ANZ in good shape under this strong leadership and I will be keenly monitoring ANZ’s progress.

I am also delighted Paul O’Sullivan has succeeded me as Chairman. Paul is an outstanding company director who has already made a strong contribution to the Board. He has my absolute confidence.

Finally, I would like to thank shareholders for their support over the years and acknowledge the efforts of our 39,000 people who have been working hard for our customers, shareholders and the broader community.