Half Yearly Report/ASIC Half Yearly Accounts

Document date:  Thu 26 Apr 2001
Published:  Thu 26 Apr 2001 14:02:39
Document No:  175940
Document part:  O
Market Flag:  Y
Classification:  Half Yearly Report , Half Year Audit Review , Half Year Directors' Statement , Half Year Accounts , Dividend Record Date , Dividend Pay Date , Dividend Rate , Other 

AUSTRALIA AND NEW ZEALAND BANKING GROUP       2001-04-26  ASX-SIGNAL-G

HOMEX - Melbourne                                                     

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CHIEF FINANCIAL OFFER'S REVIEW (CONTINUED)

PACIFIC
BOB LYON

Provision of primarily retail banking services in 9 countries in 
the Pacific region.

                                           HALF YEAR        HALF YEAR
                                           MAR 2001         MAR 2000
                                           $M               $M

Net interest income                          41               40
Other external operating income              34               29
Net inter business unit fees                  -                - 

Operating income                             75               69
External operating expenses                 (31)             (27)
Net inter business unit expenses            (10)              (6)

Operating expenses                          (41)             (33)

Profit before debt provision                 34               36
Provision for doubtful debts                 (4)              (3)
Income tax expense and outside               
 equity interests                            (9)             (11)

Net profit attributable to members           21               22
of the Company

Operating expenses to operating income   54.7%          47.8%
Net specific provisions                     2              1
Net non-accrual loans                      10              7

Total employees                         1,281          1,344

Pacific manufactures and distributes a range of retail banking and 
corporate lending products and services. Pacific's business mix is 80%
retail and 20% corporate. Pacific's branches and overseas offices 
provide a distribution/customer servicing network for Pacific 
manufactured products as well as Global Transaction Services and 
Global Foreign Exchange.

Pacific profit increased 11% over the September 2000 half. Key
drivers of the result are:

* increased net interest income with volume growth being partly offset
by reduced margins and competitive conditions in the region

* other income increasing $3 million reflecting volume growth, and 
higher foreign exchange revenue

* operating costs increasing by $2 million from the September 2000 
half year primarily reflecting higher head office charges

Bad debt provisioning remains low with increased focus on risk in the 
current economic environment. Net specific provisions are again below 
economic provisioning levels following an increase in Fiji in the 
September 2000 half year.

ANZ's presence in the Pacific region has increased over the half year 
and now includes East Timor and American Samoa from 1 April 2001.

CORPORATE CENTRE, TECHNOLOGY AND FINANCE

Peter Marriott
David Boyles

Comprises the results of assets and liability management earning on 
central capital, costs relating to hedging capital positions, 
technology and payments operations and certain central costs.


                                       HALF YEAR        HALF YEAR
                                       MAR 2001         MAR 2000
                                       $M               $M

Net interest income                        71             68
Other external operating income            21             (5)
Net inter business unit fees                7            (10) 

Operating income                           99             53
External operating expenses              (370)          (360)
Net inter business unit expenses          302            305

Operating Expenses                        (68)           (55)

Profit before debt provision               31             (2)
Provision for doubtful debts               (5)            (9)
Income tax expense and outside            (28)            36
equity interests

Net profit attributable to members         (2)            25
of the Company

Net loans and advances including
acceptance                               (108)           (60)
Other external assets                  13,717          9,491
External assets                        13,609          9,431

Deposits and other borrowings          23,638         27,864
Other external liabilities             24,144         14,936
External liabilities                   47,782         42,800

Total employees                         4,313          4,234

Corporate centre, Technology and Finance combines the central support 
and shared service units of the Group.  Costs incurred in central 
support units are charged out to business units.

The CFO units are responsible for the overall financial management of 
the Group, through development and implementation of risk policy, 
balance sheet management and performance management.

Technology, e-commerce and payments aims to develop and maintain a 
leading eCommerce presence, while supporting the drive to build 
stronger customer relationships and greater customer satisfaction 
globally.  Continual improvements in efficiency and service platforms 
are delivered along with reliable support for traditional banking 
products and services.

Corporate Centre, Technology and Finance also includes the results of 
asset and liability management, earnings on central capital, costs 
allocated to hedging capital positions and certain central costs.

The result for the current half year includes:

* write downs of investments in Panin ($43 million), E*Trade ($21 
million) and other equity investments

* receipt of dividends (St George $10 million, Panin $11 million)

* profit on sale of St George investment ($65 million after tax)

* losses on foreign currency revenue hedges of $14 million

* sundry asset write offs and reduced earnings from asset and 
liability management

Prior periods benefited from recognition of revenue from the E*Trade 
alliance of $19 million (September 2000) and $7 million (March 2000).

DISCONTINUED BUSINESSES


                                       HALF YEAR        HALF YEAR
                                       MAR 2001         MAR 2000
                                       $M               $M

Net interest income                      20              183
Other external operating income         (19)             133
Operating income                          1              316
Operating expenses                       (1)            (164)

Profit before debt provision              -              152
Provision for doubtful debts             (8)             (35)
Income tax expense and outside equity
 interests                               (4)             (70)
Net profit attributable to members
 of the Company                         (12)              47

Net loans and advances including
 acceptances                            514            6,535
Other external assets                   794            4,283
External assets                       1,308           10,818

Deposits and other borrowings         1,128           11,256
Other external liabilities              905            1,630
External liabilities                  2,033           12,886

Net interest average margin            2.30%            2.77%
Return on assets                        n/a             0.66%
Return on risk weighted assets          n/a             1.15%
Operating expenses to operating income  n/a            51.9%
Operating expenses to average assets    n/a             2.30%

Net specific provisions                   4               23
Net specific provision as a % of 
 average net advances                  1.33%            0.80%
Net non-accrual loans                    38               86
Net non-accrual loans as a $ of 
 net advances                          7.2%             1.3%

Total employees                          22            5,402


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