A $5 billion profit is nothing to sneer at, is it? Perhaps it is if you’re wondering what is going on with the nation’s banking profits and lending rates.
Following Australia & New Zealand Banking Group’s Thursday announcement that its annual net profit jumped 33 percent to A$5 billion, the heated debate between the financial industry and the Federal government has heated up. The Senate voted to hold an inquiry looking into bank fees and interest rate charges shortly after ANZ made its announcement, and a day after National Australia Bank Ltd. reported a 63 percent jump in net profit for the year.
According to The Age, ANZ Chief Executive Officer Mike Smith quickly shot back at treasury spokesman Joe Hockey, comparing him to Venezuelan president Hugo Chavez. “'Mr. Hockey seems to be on some kind of personal vendetta, it would appear he has been taking economics lessons from Hugo Chavez,” Smith was quoted.
Despite the verbal attack, Smith is no doubt pleased with the bank’s results. He said, “Having weathered the global financial crisis, it’s pleasing to start putting some serious runs on the board. ANZ is a more predictable organization for shareholders and a better place for our customers to do business.”
ANZ’s cash profit rose 16 percent to $2.76 billion from A$2.38 billion in the second half, while its operating income for the year rose 15 percent to $15.69 billion.
Though ANZ has “weathered” the global financial crisis, it’s still hard to justify a $5 billion profit when many Australians are still struggling to pay their mortgages.
