ANZ Plans to Cut ‘Many Hundreds’ of Jobs
Australia & New Zealand Banking Group Ltd. is preparing to cut as many as 900 jobs, according to a union that represents bank workers, as the lender trims costs in an economy where demand for mortgages has slumped to the weakest pace in three decades.
“They’ve certainly confirmed it will be in the hundreds,” Leon Carter, national secretary of the Finance Sector Union in Melbourne, said in a telephone interview today. Kevin Foley, an ANZ Bank spokesman in Sydney, said in an e-mailed statement that “there is some belt tightening going on in response to difficult market conditions.”
Australia’s four biggest banks, which employ about 178,000 people, are among lenders around the world facing slower revenue growth as borrowing falls among consumers whose confidence has been battered by Europe’s debt woes and market turmoil. Melbourne-based ANZ Bank today left unchanged its variable mortgage interest rate, citing the “subdued state of credit demand.”
ANZ Bank “said to us that due to cost pressures and expectations that revenue is going to be difficult to generate over the course of this year, they’re going to embark on a fairly aggressive cost-saving regime,” Carter said.
Among Australia’s so-called big four lenders, ANZ Bank employees individually delivered the least profit, according to data compiled by Bloomberg and company reports. ANZ Bank made A$109,424 ($113,013) in net income from each employee in the year ended September 2011. That compared with A$138,819 at Commonwealth Bank of Australia, A$185,379 at Westpac Banking Corp. (WBC), and A$116,900 at National Australia Bank Ltd., the data show.
U.K.-based Royal Bank of Scotland Group Plc yesterday said it will sell or close its equities, mergers advisory and equity capital markets business, eliminating 3,500 jobs. More than 400 of the bank’s Australian employees may be affected, the Australian Financial Review said today.
Carter said some ANZ Bank staff reductions “will be jobs that disappear, others will be the continuation of their offshoring of Australian jobs.” He said most cuts, which may total between 500 and 900, will be made in the first half of the year.
ANZ Bank’s Foley said “we are still working through the detail, though impacts to staff in customer-facing roles will be minimal.”
The Australian Financial Review first reported that ANZ Bank staff received an e-mail late yesterday from Philip Chronican, head of the bank’s Australian division, identifying the need for redundancies.
Rates on Hold
Chronican said in a separate statement today that the lender decided it was “prudent” to keep the rates it charges customers for mortgages and small company loans unchanged.
The interest rate announcement is the first time the bank instituted its policy announced Dec. 8 of declaring decisions on mortgage rates on the second Friday of every month. The bank is seeking to decouple itself from the Reserve Bank of Australia’s interest-rate cycle, in which policy makers meet on the first Tuesday of every month except January.
ANZ Bank shares climbed 0.5 percent in Sydney trading, the fifth straight advance.
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