31 Aug 2009

Economic conditions remain difficult - ANZ

10:14 pm on 31 August 2009

ANZ bank says economic conditions in New Zealand remain difficult and will take longer to recover than in Australia and Asia.

In a trading update for the 10 months to July, ANZ chief executive Mike Smith says cash profit is tracking in line with 2008 and growth in provisions to cover bad debt has moderated in all areas except New Zealand.

Mr Smith says the economies of Australia and Asia are already showing early signs of improvement, but the recovery in New Zealand is likely to be much slower.

ANZ National Bank made a profit of $478 million in the nine months to June, a decrease of 43% on the same period a year ago.

Provisions for bad debts more than tripled to $532 million, while it has also been hit by a charge of $147 million to cover its obligations to investors in ING's two frozen funds.

Excluding provisions, underlying profit rose 14% as the bank made more money from volatile market conditions.