ANZ to Cut About 200 Jobs in Australia as Loan Growth Slowsby
Positions are largely in Melbourne in managerial, back office
Reduction reflects the subdued economy and need to simplify
Australia & New Zealand Banking Group Ltd. is getting rid of about 200 jobs in its Australian unit as lending growth slows in a subdued economy.
The reductions will be largely in Melbourne and affect managerial and back-office roles in areas such as marketing and project management, Melbourne-based spokesman Stephen Ries said in an e-mail Tuesday.
ANZ’s job cuts highlight the challenges ahead for Australian banks after three of the four largest lenders this month announced net income that missed analyst estimates amid rising corporate loan defaults. ANZ is also slashing its Asian and institutional-banking workforce as part of a move to exit low-returning assets.
“Australian lenders are under pressure to have the right asset mix as capital requirements increase, and in that general push they are trying to ensure they have the right cost base,” said Rohan Walsh, an investment manager at Melbourne-based Karara Capital Ltd., which manages about $1.8 billion. “ANZ, in particular, is already shrinking its Asian operation to boost returns and one would think ongoing cost controls would be the focus of the management team.”
Not Done Yet
ANZ reduced its institutional-banking workforce by 6 percent and trimmed the number of employees in the Australian business by 3 percent in the year to March 31, according to filings. The lender is not done with job cuts in the institutional bank, the head of the business, Mark Whelan, said in an interview last week.
“The changes are in response to subdued economic conditions, low lending growth and the need to simplify our business and improve productivity,” Ries said. The lender also has an external hiring freeze in place, he said. The Australian unit employed 8,791 at the end of March, according to filings.
Growth in mortgages, which make up two-thirds of the assets of the largest Australian banks, has slipped to the lowest in almost a year, central-bank data showed.
The lenders are facing a number of regulatory pressures, including the push to tighten mortgage standards after home prices raced to a record, and add more capital. The four largest banks -- ANZ, Commonwealth Bank of Australia, National Australia Bank Ltd. and Westpac Banking Corp. -- together raised a record A$20 billion in fresh equity in 2015 and the regulator has said required capital levels will be clearer by the end of the year.
ANZ shares closed 0.8 percent higher at A$24.51 in Sydney, compared with a 0.7 percent increase in the benchmark S&P/ASX 200 Index.