ANZ – Page 4 – Digital Finance Analytics (DFA) Blog

ANZ Ups The Mortgage Rate Ante

ANZ has become the first big lender to cut its variable home loan rate for new customers, as the banks slug it out for business in a tightening market.

While banks including the CBA have cut fixed loan rates and offered “honeymoon deals” in recent weeks, the ANZ is the first to move on variable rates.

It comes at a time when there is upward pressure on interest rates as funding costs, particularly for smaller lenders, are rising.

The ANZ told mortgage brokers it was bringing down its basic principal and interest home rate for owner-occupiers by 0.34 percentage points to 3.65 per cent.

The ANZ offer only applies to new customers looking for a loan valued at 80 per cent or less than the value of their property.

Loan-to-value ratios above 80 per cent remain unchanged at 3.99 per cent.

Non-bank lenders growing market share rapidly

It comes at a time when small lenders have been eroding the market share of the Big Four banks.

While non-bank lenders hold less than 8 per cent of the mortgage market, their loan books have grown by about 14 per cent over the year, while growth at the Big Four is at a historically low level, a little over 1 per cent.

Ratecity research director Sally Tindall said it was a surprising move from ANZ to buck the rate-hike trend.

“It shows that the bank is competing hard to get new customers as non-banks threaten their market share,” Ms Tindall said.

“This comes at a time when the market was expecting ANZ to hike rates and not cut them and the [banking] royal commission has turned the playing field on its head.”

There are lower rates offered by the big banks in the market but they are generally so-called honeymoon deals that step up markedly after two or so years, or four years in the case of most fixed loan products.

Ms Tindall said the other three big banks were likely to come under pressure to follow ANZ’s lead or risk a further erosion of their market share.

Carefully targeted cut

Shaw and Partners bank analyst Brett Le Mesurier said ANZ’s move was carefully targeted.

“I was surprised by the extent of the reduction but ANZ has been courting the owner-occupier market for some time, and shunning the investment market relatively — most of their loan growth has been coming from Australian owner-occupier loans,” Mr Le Mesurier said.

He said there was little doubt that the differential between high-quality owner-occupier rates and investor loan rates was likely to increase.

“The banks are focusing on the below 80 per cent LVR [loan-to-value ratio] owner-occupier loans and that may well be because they expect the capital charges associated with those loans to reduce.

The bank is also cutting some of it fixed rate loans by up to 0.24 percentage points, following CBA’s move to cut fixed rates on various two and three-year fixed rate loans by 0.1 percentage points earlier this week.

ASIC accepts court enforceable undertakings from CBA and ANZ over superannuation product distribution

ASIC has accepted court enforceable undertakings from the Commonwealth Bank of Australia and Australia and New Zealand Banking Group under which the banks have agreed to change the way they distribute superannuation products to their customers.

ASIC investigated CBA’s distribution of its Essential Super product and ANZ’s distribution of its Smart Choice Super and Pension product (Smart Choice Super) through bank branches. ASIC found a common practice of offering those products to customers at the conclusion of a fact-finding process about customers’ overall banking arrangements.

CBA’s fact-finding process was called a ‘Financial Health Check’. CBA staff also sometimes helped customers roll over their other superannuation into the Essential Super account at the time of distribution.

ANZ’s fact-finding process was called an ‘A-Z Review’.

ASIC was concerned that the proximity between the fact-finding process and the discussion about Essential Super or Smart Choice Super was leading CBA staff and ANZ staff to provide personal advice to customers about their superannuation. Branch staff for both CBA and ANZ were only authorised to provide general advice.

Stricter consumer protection laws apply to financial services licensees when their representatives give personal advice about complex financial products such as superannuation than when they provide general advice about those products. This includes the requirement, with personal advice, to give a customer a Statement of Advice and to act in the customer’s best interests. People who give personal advice about complex products are also required to meet higher training standards.

ASIC was concerned that customers may have thought, due to the proximity of the fact-finding process to the offer of Essential Super or Smart Choice Super, that the CBA branch staff or the ANZ branch staff were considering risks specific to the customer when this was not the case.

These court enforceable undertakings prevent CBA from distributing Essential Super in conjunction with a Financial Health Check and ANZ from distributing Smart Choice Super in conjunction with an A-Z Review. They also require CBA and ANZ to each make a $1.25 million community benefit payment. If there is a breach of the undertaking ASIC can, under the ASIC Act, apply for orders from the court to enforce compliance.

CBA chose to suspend the distribution of Essential Super in CBA branches in October 2017.

‘ASIC will continue to proactively monitor how complex financial products such as superannuation are sold,’ ASIC Deputy Chair Peter Kell said.

ASIC’s actions underline the importance for financial services licensees to ensure that customers understand the nature of advice they are receiving about their superannuation.

View the enforceable undertaking

Background

ASIC’s investigation arose following a surveillance conducted in relation to CBA’s distribution of its retail superannuation product, Essential Super and ANZ’s distribution of its retail superannuation product, Smart Choice Super.

These actions are part of ASIC’s Wealth Management Project. The Wealth Management Project was established in October 2014 to lift the standards of major financial advice providers. The Wealth Management Project focuses on the conduct of the largest financial advice firms (NAB, Westpac, CBA, ANZ, Macquarie and AMP).

Criminal charges against banking ‘cartels’ show Australia is getting tough on competition law

From The Conversation.

A two-year probe by Australia’s consumer watchdog has resulted in criminal charges against ANZ, Citigroup and Deutsche Bank, as well as six of their senior executives, over alleged “cartel-like” behaviour.

The case, brought by the Commonwealth Director of Public Prosecutions (CDPP) after an investigation by the Australian Competition and Consumer Commission (ACCC), is the second prosecution of its kind to be brought in Australia since competition laws were tightened almost a decade ago.

The banks and six investment bankers are charged with cartel conduct related to the sale of A$2.5 billion worth of unsold ANZ shares to investors in August 2015. The ACCC alleges that senior executives from the three banks colluded in the way they dealt with these shares.

The exact details of the alleged criminal conduct will only become clear at a Sydney court hearing on July 3, 2018.

What is cartel behaviour?

Cartels are forms of anti-competitive conduct where cartel participants decide to stop competing and start colluding. Australian civil law has banned cartels for decades. But the practice only became a criminal offence in 2010. Only its serious forms are subject to criminal law; civil law still governs the rest.

Cartels can take different forms. In the most common instance, participants collude by setting their prices. Other forms include: output restrictions; dividing markets among cartel participants on mutually agreed terms; and bid-rigging, in which a commercial contract is decided in advance but other operators put in sham bids to give the appearance of competition.

There is one primary reason why businesses or executives would stop competing and start colluding: profit. In short, cartel participants cheat to get more money, creating higher prices and lower output in the process. This disadvantages consumers, the economy and society at large.

But proving criminal collusion in a court is harder than it might seem.

Beyond reasonable doubt

Although we need to wait for the case to unfold to find out more, what we can tell at this stage is that the ACCC and the CDPP perceive the alleged conduct as serious enough for it to constitute a criminal case. Criminal cases are harder to prove than civil cases. Cartel collusion must be proved beyond reasonable doubt, and the evidence has to show that the individuals involved knew (or believed) that they were colluding.

What these charges also show is that the ACCC and the CDPP are prepared to go after the most powerful corporations and their executives for alleged cartel-like conduct. This is an enormously important step for deterrence, because criminal charges are naturally more attention-grabbing than civil lawsuits.

Charging high-ranking bank executives will potentially make the deterrent more effective still, because high-ranking executives set the cultural tone for their organisations.

Research has shown that significant prison time – or the threat of it – for individuals is a more effective deterrent than civil penalties; especially if the penalties are not high enough, as was argued in the recent OECD report on corporate penalties for cartels in Australia. The report showed that the penalties applied in Australia were low in comparison with competition law regimes in the European Union and the United States.

Just the beginning?

This is the second Australian criminal case of cartel conduct – the first involved a Japanese company shipping cars to Australia. We can reasonably expect more of these kinds of charges in the future, given that the laws are only eight years old and investigations of this type typically take years to reach fruition. (The alleged cartel conduct in the latest case took place in August 2015, almost three years ago.)

There are differences in investigation procedures between criminal and civil cases, to ensure that collected pieces of evidence are admissible in a criminal proceeding. It is ultimately the CDPP’s (and not the ACCC’s) decision whether or not to prosecute.

The final step is for criminal proceedings to be prosecuted. The first cartel criminal case, which concerned the shipping industry, can be perceived as successful, with two global shipping companies pleading guilty.

It is still early days for Australia in terms of tracking down and punishing examples of cartel behaviour via criminal prosecutions. But the latest developments suggest that Australia is prepared to follow the example of the world leader in successful cartel-related criminal prosecutions: the United States.

The US criminal regime is one of the oldest in the world, having existed since 1890. The US boom of cartel-related criminal cases began in the late 1990s with the lysine cartel and the vitamin cartel and with the first foreign national being sentenced to imprisonment in July 1999. One of the first criminal cartel investigations inspired the production of the 2009 movie The Informant!.

The numbers further illustrate the success of the US criminal prosecutions. For instance, 27 corporations and 82 individuals were charged in the fiscal year 2011. Australia has a long way to go before it can match those numbers.

Author: Barbora Jedlickova, Lecturer, School of Law, The University of Queensland

Criminal cartel charges laid against ANZ, Citigroup and Deutsche Bank

Citigroup Global Markets Australia Pty Limited (Citigroup), Deutsche Bank Aktiengesellschaft (Deutsche Bank) and Australia and New Zealand Banking Group Ltd (ANZ) have been charged with criminal cartel offences following an investigation by the ACCC.

Criminal charges have also been laid against several senior executives: John McLean, Itay Tuchman and Stephen Roberts of Citigroup; Michael Ormaechea and Michael Richardson formerly of Deutsche Bank; and Rick Moscati of ANZ.

The charges involve alleged cartel arrangements relating to trading in ANZ shares held by Deutsche Bank and Citigroup. ANZ and each of the individuals are alleged to have been knowingly concerned in some or all of the alleged conduct.

The cartel conduct is alleged to have taken place following an ANZ institutional share placement in August 2015.

“These serious charges are the result of an ACCC investigation that has been running for more than two years,” ACCC Chairman Rod Sims said.

“Charges have now been laid by the Commonwealth Director of Public Prosecutions and the matter will be determined by the Court.”

The matter is listed before the Downing Centre Local Court in Sydney on 3 July 2018.

The Competition and Consumer Act requires any trial of such offences to proceed by way of indictment in the Federal Court of Australia or a State or Territory Supreme Court.

As this is a criminal matter currently before the Court, the ACCC will not be providing further comment at this time.

Background

The ACCC investigates cartel conduct, manages the immunity process and, in respect of civil cartel contraventions, takes proceedings in the Federal Court of Australia.

The Commonwealth Director of Public Prosecutions (CDPP) is responsible for prosecuting criminal cartel offences in accordance with the Prosecution Policy of the Commonwealth. The ACCC refers serious cartel conduct to the CDPP for consideration of prosecution in accordance with the Memorandum of Understanding between the CDPP and the ACCC regarding Serious Cartel Conduct.

ANZ’s regulatory capital will increase with OnePath Life NZ sale to Cigna

Last Wednesday, Australia and New Zealand Banking Group Limited announced that it had agreed to sell its New Zealand life insurance business OnePath Life NZ Limited to Cigna Corporation, a global healthcare services organization with an established New Zealand specialist insurance business. The planned sale is credit positive for ANZ because it will lift the group’s Level 2 Common Equity Tier 1 (CET1) ratio by approximately 15 basis points, says Moody’s.

Total consideration for the sale is NZD700 million and the company expects to generate a gain of approximately NZD50 million. As part of the agreement, ANZ will enter a 20-year strategic alliance with Cigna to offer life insurance products through ANZ’s distribution channels. ANZ expects to complete the sale during its 2019 fiscal year, which ends September 2019.

The sale follows ANZ’s announcement in December 2017 that it had agreed to sell its Australian insurance business to Zurich Insurance Company Ltd. (financial strength Aa3 stable) for a total consideration of AUD2.85 billion.

The sale comes as capital requirements for Australian banks are increasing. The Australian Prudential Regulation Authority announced in July that it is increasing the minimum capital requirements for ANZ and domestic peers Commonwealth Bank of Australia, National Australia Bank Limited and Westpac Banking Corporation to 9.5% by 2021 from 8% currently, including a capital conservation buffer and a domestic systemically important bank charge. Although the higher capital requirements will take effect in early 2021, the regulator said it expects banks to exceed the new requirement by 1 January 2020 at the latest.

ANZ’s sale of OnePath Life NZ, combined with the previously announced sale of its Australian life insurance business and it pension, investments and aligned dealer groups’ business, will boost ANZ’s CET1 ratio by approximately 95 basis points. That includes 65 basis points from the sale and reinsurance of its Australian life insurance business, 15 basis points from the sale of pensions, investments and aligned dealer groups’ business and 15 basis points from the sale of OnePath Life NZ). The transactions will significantly raise ANZ’s CET1 ratio well above the future minimum requirement of 9.5%.

Consequently, we expect that ANZ will continue to return surplus capital to shareholders in line with its announced AUD1.5 billion on-market share buyback. ANZ had completed AUD1.1 billion of share buybacks as of 31 March 2018. The additional capital generated by these business sales may provide capacity for future share buybacks. Despite these capital distributions, ANZ remains highly capitalized, with excess capital above the higher future minimum requirements of AUD 5.7 billion, assuming it completes the full AUD1.5 billion on-market share buyback.

Criminal Cartel Charges to be Laid Against ANZ, Deutsche Bank and Citigroup

From ANZ this morning:

The Commonwealth Director of Public Prosecutions (CDPP) advised ANZ late yesterday it intends to commence proceedings against the bank for being knowingly concerned in alleged cartel conduct by the joint lead managers of ANZ’s underwritten Institutional Equity Placement of approximately 80.8 million shares in August 2015.

The proceedings relate to an arrangement or understanding allegedly made between the joint lead managers in relation to the supply of ANZ shares. ANZ understands the CDPP also intends to bring proceedings against ANZ Group Treasurer Rick Moscati.

ANZ Chief Risk Officer Kevin Corbally said: “We believe ANZ acted in accordance with the law in relation to the placement and on that basis the bank intends to defend both the company and our employee.”

ANZ is also co-operating with an investigation by the Australian Securities and Investments Commission (ASIC) in relation to the placement.

ASIC is investigating whether ANZ’s announcement of 7 August 2015 should have stated the joint lead managers took up approximately 25.5 million shares of the placement. This represented approximately 0.91% of total shares on issue at that time.

ANZ does not intend to provide further comment at this time.

From the ACCC:

Following an announcement made by ANZ to the ASX this morning regarding anticipated criminal cartel charges, the ACCC confirms that criminal cartel charges are expected to be laid by the Commonwealth Director of Public Prosecutions (CDPP) against ANZ, ANZ Group Treasurer Rick Moscati, two other companies and a number of other individuals. These charges will be laid following an investigation by the ACCC.

“The charges will involve alleged cartel arrangements relating to trading in ANZ shares following an ANZ institutional share placement in August 2015,” ACCC Chairman Rod Sims said.

“It will be alleged that ANZ and the individuals were knowingly concerned in some or all of the conduct.”

The ACCC will not make any further comment until charges are laid.

Background

The ACCC investigates cartel conduct, manages the immunity process and, in respect of civil cartel contraventions, takes proceedings in the Federal Court of Australia.

The CDPP is responsible for prosecuting criminal cartel offences in accordance with the Prosecution Policy of the Commonwealth. The ACCC refers serious cartel conduct to the CDPP for consideration of prosecution in accordance with the Memorandum of Understanding between the CDPP and the ACCC regarding Serious Cartel Conduct.

ACCC also said Criminal cartel charges to be laid against Deutsche Bank

Further to its earlier statement regarding criminal cartel charges expected to be laid by the Commonwealth Director of Public Prosecutions (CDPP) against ANZ and its Group Treasurer Rick Moscati, the ACCC can confirm that Deutsche Bank AG is one of the two other companies against which charges are expected to be laid, along with a number of individuals.

The expected charges follow an extensive ACCC criminal cartel investigation.

The ACCC will not make any further comment until charges are laid.

And ACCC says Criminal cartel charges to be laid against Citigroup

Further to its earlier statements regarding criminal cartel charges expected to be laid by the Commonwealth Director of Public Prosecutions (CDPP) against ANZ, its Group Treasurer Rick Moscati, and Deutsche Bank, the ACCC can confirm that Citigroup Global Markets Australia Pty Limited is the other company against which charges are expected to be laid, along with a number of individuals.

The expected charges follow an extensive ACCC criminal cartel investigation.

The ACCC will not make any further comment until charges are laid.

ANZ culls sales incentives for planners

From Financial Standard.

ANZ will no longer factor in sales incentives while calculating bonuses for its financial planners and boot them out if they fail an audit twice, the bank announced today.

As ANZ attempts to revive its advice business after Royal Commission hearings and ahead of IOOF acquisition, chief executive Shayne Elliott admitted the bank had failed some of its financial advice customers.

“We know it has taken too long for changes to occur, so where we see solutions we will act. That’s why we are getting on with these initiatives now,” he said.

On April 23, it was revealed ANZ kept a “leaderboard” that ranked advisers on the revenue they brought in.

It changed its revenue-centric adviser remuneration on April 12 – less than two weeks before the RC’s questioning of ANZ chief risk officer and head of digital and wealth Australia, Kylie Rixon. The bank then limited revenue-based measures to only 15% of compensation criteria and abolished the leader board, Rixon said.

Today, ANZ said it has removed all sales incentives for bonuses and will now only asses performance on customer satisfaction, risk and compliance standards and ANZ values.

To keep its adviser pool clean of inappropriate planners, ANZ is promising to boot out planners if they fail an audit twice.

It is also placing higher expectations on the qualifications of its advice professionals after last month, senior counsel assisting Rowena Orr revealed that only 35% of all financial advisers have completed a bachelor degree or above.

Financial planners looking to work with ANZ will now need to have a relevant undergraduate degree and industry certification.

The bank said it will push existing planners to enrol in further training by January, 2019.

ANZ is promising to compensate 9000 clients who received unappropriated advice from ANZ professional, by the end of the year.

Earlier last month, ANZ footed a $50 million bill in compensating its fee-for-no-service bungle for its Prime Access Clients, also copping an enforceable undertaking from ASIC.

At the time, ASIC said the compensation program was “nearing completion”.

ANZ anticipates $50 million in legal costs stemming from the Royal Commission for the year ending September , it revealed in an earnings report.

The bank’s wealth business is set to be acquired by IOOF.

On April 24, IOOF announced that it has cleared all regulatory hurdles in acquiring OnePath’s pension and investments and four aligned dealer groups.

The deal was announced in September 2017 and at the time IOOF would pay about $975 million.

On May 2, Financial Standard reported that IOOF had updated the market on ANZ’s 1H18 financial results, ahead of the acquisition.

ANZ’s 1H18 results reveal that cash profits in its wealth division slid by 24% to $44 million. ANZ said this was because of a non-recurring lenders mortgage reinsurance profit share being included in the 1H17 results, strengthening of claims provisioning in 1H18 and lower new business volumes in ANZ Financial Planning.

The bank is also offering a no-cost advice review to all its financial planning customers who “may have concerns about their current financial position”, it announced today.

ANZ 1H 18 Result – Banking On Home Loans

ANZ reported their 1H 18 results today, amid the turmoil of the Royal Commission, its good to get back to real bank results!

They announced a statutory profit after tax of $3.32 billion, up 14% and a cash profit on a continuing basis of $3.49 billion up 4% on the prior comparable period. This was a bit below consensus, thanks to lower than expected Institutional results. But the simplification of the business is paying dividends, provided the home lending markets in Australia and New Zealand continues to fire…

There was some restating of results thanks to the handling of OnePath Life and OnePath Pensions now classed as discontinued operations and shown separately. Inclusive of the $617 million negative impact, the Group cash profit would be $2.88 billion. They expect around 80 basis points of total capital benefit.

In the half they finalised the sale of six Asian retail and wealth businesses which allows the bank to further strengthen their focus on Institutional, which continues to have a regional footprint across 15 markets in Asia. Total institutional RWA fell $42 billion, down 20% since FY15. But more significantly, 60% of Group capital is now allocated to Retail and Commercial businesses in Australia and New Zealand, up from 44% in 2015. ANZ is now a very different shaped bank. Much more reliant on the performance of the local economy!

They grew home loans in Australia, by 6%, with a strong focus on owner -occupied (P&I) and 5% in New Zealand.

Australian home loan delinquencies were higher, mainly thanks to ongoing issues in WA. WA is 13% of portfolio but 30% of 90+ and half of portfolio losses.

More recent loans (written at higher underwriting standards?) are performing a little better, but there are some issues with older loans.

ANZ has throttled back IO loans, and they say serviceability assessment is based on ability to repay principal & interest repayments calculated over the residual term of loan. Serviceability assessment is based on ability to repay principal & interest repayments calculated over the residual term of loan. Proactive contact strategies are in place to prepare customers for the change in their cash repayments ahead of Interest Only expiry.

Group Net interest margin fell 5 basis points from 2H17. However, NIM was up in Australia (+5 basis points) and New Zealand (+6 basis points).

Expenses fell, thanks to a reduction in staff and consolidation.

Total provision charge for the half was $408 million, which equates to a loss rate of 14 basis points, down from 21 basis points at the end of FY17. New impaired assets declined 32% over the half, with gross impaired assets down 15% over the same period.

ANZ’s CET1 was 11.0%, up 91 basis points, or 16.3% on an international comparable basis.

Their return on equity increased 32 basis points to 11.9% with cash earnings per share up 4% 10 119.4 cents.

They announced an interim dividend of 80 cents per share, a payout ratio of 66% of cash profit.

ANZ external legal costs relating to the Royal Commission will be around $50 million for 2018. They say they cannot predict the outcome of the Inquiry or its impact on either the bank or the broader Industry.

ASIC accepts enforceable undertaking from ANZ for fees for no service conduct

ASIC says it has accepted an enforceable undertaking (EU) from Australia and New Zealand Banking Group Limited (ANZ) after an investigation found that ANZ had failed to provide documented annual reviews to more than 10,000 ‘Prime Access’ customers in the period from 2006 to 2013.

The EU requires ANZ, among other things, to:

pay a community benefit payment totalling $3 million

provide an audited attestation from ANZ senior management to provide ‘reasonable assurance’ that the bank has, since 2014, provided documented annual reviews to customers who were entitled to such reviews, and

provide further audited attestations from ANZ senior management as to the improvements that the bank has made to its compliance systems and processes, and that the design and implementation of those systems and processes will seek to ensure documented annual reviews are provided in accordance with the ANZ Prime Access package.

ASIC Deputy Chair Peter Kell said, ‘Our report into Fees For No Service in October 2016 identified the major financial institutions’ systemic failures in this area, which required affected customers to be fairly compensated and to be provided with the services that they have paid for.

‘ASIC considered it critically important that improved systems and procedures be put in place to ensure this breach of trust could not re-occur. This enforceable undertaking with ANZ will deliver on that commitment,’ he said.

In addition to the EU, ANZ has also agreed to compensate its Prime Access customers who, in the period from 2006 to 2013, did not receive the documented annual reviews that they were entitled to. The compensation program is nearing completion and as at 28 February 2018, ANZ has paid $46.81 million (including earnings) in compensation to these customers (with the total compensation estimated at $46.85 million).

Background

The EU follows an ASIC investigation into ANZ in relation to ANZ’s fees for no service conduct concerning the Prime Access service package which was offered to ANZ’s financial planning customers for an annual fee from 2003. A key component of the package was the provision of a documented annual review of the customer’s financial plan.

As a result of the investigation, ASIC was concerned that:

ANZ had failed to provide documented annual reviews to more than 10,000 Prime Access’ customers who had paid for those reviews

ANZ did not have adequate systems and processes in place to ensure that the ‘Prime Access Service, including the provision of documented annual reviews, was provided to Prime Access customers

from as early as 2008, ANZ Financial Planning was aware of a number of confirmed instances in which documented annual reviews had not been provided to Prime Access customers, and that there was a risk of a broader issue in relation to further Prime Access customers not being provided with documented annual reviews, but the conduct continued until 2013, and ANZ did not breach report the conduct to ASIC until August 2013, and

ANZ failed to comply with section 912A(1)(a) of the Corporations Act which provides that a financial services licensee must do all things necessary to ensure that the financial services covered by the licence are provided efficiently, honestly and fairly and a condition of its Australian Financial Services Licence.

ANZ acknowledged in the EU that ASIC’s concerns were reasonably held.

ANZ Job Ads Flat In March

ANZ says that Australian Job Advertisements was flat (0.0% m/m) in March, after easing slightly (-0.4%) in February. The number of job ads currently sits 11.5% higher than a year ago.

In trend terms, job ads were up 0.8% m/m in March, edging down from a 0.9% rise in the previous month. The annual trend rate slowed from 12.2% in February to 11.8% last month.

ANZ’S HEAD OF AUSTRALIAN ECONOMICS, DAVID PLANK, COMMENTED:

“Despite ANZ Job Ads easing slightly in the past two months, the strong January result means that job ads are up 4.4% q/q in Q1. Interestingly, after a period of employment growth overshooting growth in job ads, the two series appear to be converging once more.

Despite the recent stability in ANZ Job Ads, the labour market remains robust. The level of job ads is consistent with continued strength in employment growth, though we do expect some slowdown in the pace in which jobs are added. Businesses reported record conditions in February and the uptrend in capacity utilisation suggests that the unemployment rate will slowly grind lower through the year. The recent uptick in the unemployment and underemployment rate, however, shows that spare capacity is reducing only gradually indicating that wage growth is likely to remain muted for some time yet.”