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To Provide GST refunds-Lenders Mortgage Insurance customers

Document date:  Fri 01 Sep 2000
Published:  Fri 01 Sep 2000 15:06:16
Document No:  166395
Document part:  A
Market Flag:  Y
Classification:  Other

AUSTRALIA & NEW ZEALAND BANKING GROUP LI      2000-09-01  ASX-SIGNAL-G

HOMEX - Melbourne                                                     

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ANZ today announced it would provide customers with refunds
associated with GST collected on premiums for Lenders Mortgage
Insurance following amendments to the Federal Government's GST
legislation earlier this year and a subsequent ruling from the
Australian Taxation Office.

Up to 25,000 customers who obtained Lenders Mortgage Insurance
between September 1999 and June 2000 will receive a full refund of
GST collected which, on average, will be approximately $140, plus
interest. (Refunds will range from $10 upwards.)

Also, up to 12,000 customers who were made Letters of Offer prior to
30 June 2000 and obtained Lenders Mortgage Insurance on loans
settled after 30 June will receive a partial refund of GST.

The refunds follow consultation with the Australian Consumer and
Competition Commission this week.

ANZ Head of Personal Financial Services, Mr Peter Hawkins, said that
as soon the changed tax situation for Lenders Mortgage Insurance was
understood, ANZ moved to quantify the issue and discuss its solution
with the ACCC.

While the matter was beyond ANZ's control, Mr Hawkins apologised to
customers who had been incorrectly charged GST on Lenders Mortgage
Insurance.

"The specialist legal advice we received in 1999 indicated an amount
of 8.75% should be charged on Lenders Mortgage Insurance to take
account of expected GST costs," Mr Hawkins said.

"However, subsequent amendments to the Federal Government's GST
legislation and a specific ruling from the ATO sought by ANZ have now
clarified the exact position on GST liability.

"As a result, GST costs have been reduced and we will refund the full
8.75% GST related increase on pre-July Lenders Mortgage Insurance
contracts. We have reduced the amount of GST on post-July Insurance
contracts to 2.5% and will refund customers the difference," he said.
Customers affected will be contacted by ANZ to provide their refund.

FOR MEDIA ENQUIRIES, CONTACT:

Paul Edwards 
HEAD OF GROUP MEDIA RELATIONS 
Telephone: 03-9273 6955 or 0409-655 550 (mobile) 
Email: edwardp12@anz.com