Half Yearly Report and Accounts

Document date:  Wed 27 May 1998
Published:  Wed 27 May 1998 00:00:00
Document No:  137675
Document part:  J
Market Flag:  Y
Classification:  

HOMEX - Melbourne                                                     

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INTERNATIONAL

                                    Half          Half           Half
                                    year          year           year
                                   Mar 98        Sep 97        Mar 97
Operating profit before 
  debt provisions ($M)              383            365           297
Economic loss provisioning ($M)      68             38            37 
Operating profit after tax ($M)
UK and Europe                        47             57            48
Asia Pacific                         57             56            41
South Asia                           44             55            29
Americas                             16             17             7
Middle East                          31             24            27
                                    195            209           152

Operating profit after 
 tax as a % of average risk 
 weighted assets                    1.4%          1.8%          1.4%
Operating expenses to net 
 operating income                  43.6%         46.5%         47.1%
Operating expenses to 
 average assets                     1.1%          1.4%          1.4%
Net specific provision as a % 
 of average net advances            1.8%          0.1%         (0.1%)
Net non-accrual loans ($M)          160             41           76
Net non-accrual loans as a % 
 of net advances                    0.9%          0.3%          0.5% 
Lending growth (%)                 10.7%          0.2%         16.8%
Total assets ($M)                 39,055        39,089        39,972
Risk weighted assets ($M)         29,708        25,128        23,178 

Employees (FTE)
UK and Europe                        883           848           852 
Asia Pacific                       2,665         2,725         2,654 
South Asia                         4,275         4,209         4,269
Americas                             165           162           158
Middle East                        1,283         1,305         1,364
Employees (FTE) - Permanent        9,271         9,249         9,297
Employees (FTE) - Temporary          302           185           123 
Total employees                    9,573         9,434         9,420 

The decline in profit after tax in the international network reflects
reduced profitability from investment banking and markets activities
in UK and Europe, and reserving of interest in South Asia. Higher
ELP, reflecting the Asia deterioration, was offset by strong foreign
exchange earnings.

The Group's aggregate Asian exposure reduced by 33% over the six
months to 31 March 1998, from $16.0 billion to $10.8 billion (refer
page 62). This reduction has been achieved mainly by contracting
non-strategic activities, with emphasis on the interbank market. ANZ
remains committed to its core services in the region as Australia and
New Zealand's international bank and continues to support strategic
network and trade relationships across Asia.

The current economic and financial outlook for several of the Asian
countries remains highly uncertain, and particularly Indonesia has a
long road ahead of it to full recovery. The Group has completed
recently a detailed review of its Asian portfolio and as a result has
made provisions of $159 million, although further losses are likely
to emerge.

Strong interest margin and foreign exchange profits in Asia Pacific
offset the impact of higher economic loss provision. UK and Europe
profits reflected the difficult financial markets trading conditions,
particularly in the first quarter. South Asia recorded good asset
growth but profits were constrained by the reserving of interest
relating to NHB. The prior half-year included releases of non-lending
provisions. Strong asset growth was recorded in Middle East which
also benefited from an after tax profit of $5 million on the sale of
the Group's interest in the Commercial Bank of Oman.

more to follow



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