ANZ today provided an update on its capital position following a series of adjustments to ANZ's Common Equity Tier 1 (CET1) arising from ANZ's acquisition of Suncorp and other model and prudential changes.
These changes include:
- Previously advised model reviews of mortgage risk weights have now been approved by both APRA and RBNZ. Once fully implemented, the benefit of these model changes will be a ~$22bn reduction in Advanced Internal Ratings Based Risk Weighted Assets.
- On 26 June, APRA released amendments to its capital framework which come into effect on 30 September. APRA has subsequently approved ANZ's application of this revised framework (APS 112).
The net benefit of these methodology and prudential changes will be ~30 basis points (bps) of Level 2 CET1 by 30 September 2024.
In addition, ANZ disclosed on 9 July it expects the impact of the Suncorp Bank acquisition to result in a reduction of 105 bps in Level 2 CET1. This represents an improvement of approximately 18 bps relative to the pro-forma estimate announced at ANZ's half year results in May.
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