ANZ Group reports slight rise in late mortgage payments

By Rishav Chatterjee

(Reuters) -ANZ Group Holdings said on Thursday late mortgage repayments edged up in the June quarter but were still below historical levels, and the Australian lender logged higher customer deposits.

The country’s fourth-largest bank mirrors trends seen at its other large lenders which are all dealing with rising financial stress among mortgage customers as a result of higher interest rates and other living costs.

Home loans with repayments past 90 days late rose by 0.03% of its total mortgage book to 0.63%, ANZ said in a limited quarterly trading update which did not include profit figures or forecasts.

Late repayments “continued to trend upwards from recent lows, impacted by higher interest rates and inflation and weather events in New Zealand”, the bank said in the update, referring to a cyclone which brought widespread flooding and landslides in the neighbouring country.

ANZ’s impairment charge to account for future bad and doubtful debts totalled A$77 million ($49.06 million), which compared to a consensus estimate of A$519 million for the third and fourth quarters combined, according to E&P Capital, citing Visible Alpha data.

“Third quarter credit impairment charge is notably lower than expectations and we expect a consensus upgrade for fiscal 2023 cash earnings on the back of this,” said E&P Capital analyst Azib Khan.

ANZ shares were down 1.1% in morning trading, in line with the broader market.

The company said net loans and advances for ANZ’s Australian retail and commercial segment grew 2% in the third quarter, while it logged a rise in customer deposits across all divisions.

Earlier in the month, the country’s no. 1 lender Commonwealth Bank of Australia warned of higher living costs impacting margins, while no. 2 lender National Australia Bank’s earnings mirrored the decline in margins.

($1 = 1.5696 Australian dollars)

(Reporting by Rishav Chatterjee and Nausheen Thusoo in Bengaluru; Editing by Sherry Jacob-Phillips, Byron Kaye and Muralikumar Anantharaman)