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As with its major bank counterparts, Commonwealth Bank of Australia and National Australia Bank (NAB), Australia New Zealand Banking Group’s (ANZ) business and private bank division recorded faster growth in its lending portfolio than its Australia retail home loan book, rising 6 per cent in the 12 months to September 2026, compared with 4 per cent growth in home loans.
In its full-year results, ANZ’s net loans and advances across its business and private bank division increased from $147 billion in September 2025 to $156 billion in September 2026, while Australia retail home loan balances rose from $264 billion to $275 billion.
Within the business and private bank division, SME banking lending increased from $40 billion to $43 billion, while lending across diversified and specialist businesses grew from $91 billion to $94 billion. Private bank lending also increased, rising from $15 billion to $16 billion.
Suncorp Bank, which is being progressively integrated into ANZ, recorded a 1 per cent decline in its business lending, from $73 billion to $72 billion, over FY25–26.
ANZ’s business and private bank recorded a 14 per cent increase in cash profit to $1.655 billion in FY25–26, while the wider group’s cash profit rose 10 per cent to $7.591 billion after adjusting for significant items in the previous year.
Credit trends diverge across business borrowers
The results also revealed diverging credit trends across ANZ’s business lending portfolio, with individually assessed impairment charges falling over the year but increasing in the latest half.
Individually assessed credit impairment charges for business banking fell 20 per cent, from $127 million in FY24–25 to $102 million in FY25–26.
Across the wider business and private bank division, ANZ attributed the reduction in individually assessed impairments to “lower impairment flows mainly in the small to medium commercial customer portfolio”.
However, this trend reversed in the six months to September, with individually assessed impairment charges for business banking increasing from $44 million in the March half to $58 million.
ANZ said the increase across the wider division was driven by “higher impairment flows in the large commercial customer portfolio”, partially offset by lower collectively assessed credit impairment.
Collectively assessed impairment charges for business banking also increased to $24 million for the full year, compared with a $25 million release in FY24–25.
ANZ added: “Portfolio losses remain low, reflecting continued strong overall credit quality of a well-diversified portfolio.”
A challenging outlook, but lending opportunities remain
Businesses have been contending with a range of regulatory and economic pressures in recent months.
NAB’s Business Survey, which has tracked confidence and conditions for more than 20 years, found that a “triple threat” of higher interest rates, global uncertainty and elevated fuel and diesel costs had pushed business confidence to near-historic lows.
Alongside these economic pressures, Australian Taxation Office debt enforcement and regulatory changes such as Payday Super have also added to pressure on business cash flow.
Despite this, business lending has remained robust across the board.
According to credit reporting bureau Equifax, business loan demand increased across all five sectors it tracks, while mortgage demand fell 19.2 per cent year on year in September.
This growth has also intensified competition among lenders. The Australian Banking Association recently found that the margin on small business loans above the cash rate had fallen to a five-year low.
ANZ also flagged competitive pressure on margins in its business and private bank division, reporting that lower asset margins had weighed on performance during FY25–26. This was partly offset by higher earnings from its replicating portfolio and favourable deposit margins.
ANZ CEO Nuno Matos said the bank was “helping small and medium-sized businesses as they weather a more challenging environment, improve efficiency and build their businesses”.
He said: “In the last year the external environment has become even more volatile, shaped by geopolitical tensions, energy price shocks and rapid technological change.
“Against this backdrop, the economies across our geographic footprint remain relatively resilient.
“In this context, our focus is on helping customers leverage opportunities and navigate risk, drawing on our deep product capabilities, our two home markets and our international network across 29 markets.”
Expanding business banking operations
ANZ said it was looking to build on the growth in its business lending book, with plans to increase its number of bankers by around 50 per cent by 2030.
Matos said the bank was on track to meet this commitment, having added 50 front-line bankers in the fourth quarter.
The bank has also launched its Banker Academy in partnership with Melbourne Business School, aimed at improving the capability of existing bankers while building a pipeline of new talent.
ANZ said the first graduates were already serving customers while it continued to develop an AI-enabled customer relationship management tool to support more informed and personalised conversations. More than 50 per cent of interactions across business and private bank were now AI-assisted.
The bank is also working to simplify its business customer platforms, including improving the experience for mid-market customers using its Transactive Global payments platform.
For small businesses, ANZ said it was developing a single customer front end, with the longer-term aim of reducing the number of customer-facing platforms used across its business banking operation from 10 to two.
Matos said: “We have remained focused on delivering our five immediate priorities across the year. We have embedded our new leadership team and begun a cultural reset, including introducing new values and updating our code of conduct to give our people clarity on the behaviours, decisions and pace expected of them.
“We are on track to deliver both the integration of Suncorp Bank and the single customer front end for our retail and small business customers by June 2027 and September 2027 respectively, in line with accelerated timelines announced last year.
“We have also made significant and sustained progress in materially simplifying the organisation, realising a productivity benefit of $902 million, exceeding the $875 million of gross cost savings we foreshadowed at the first half results.”
ANZ looks to expand proprietary lending
ANZ has flagged plans to strengthen its proprietary mortgage operations, despite brokers continuing to account for an increasing share of its new home lending.
As reported by sister brand The Adviser, brokers accounted for 71 per cent of ANZ’s home loan originations in FY25–26, up from 68 per cent a year earlier. The proprietary channel’s share of new lending fell from 32 per cent to 29 per cent over the same period.
Broker-originated loans also accounted for 63 per cent of ANZ’s outstanding home loan portfolio at September 2026, compared with 61 per cent a year earlier.
Despite the shift towards broker lending, ANZ identified strengthening proprietary origination as one of its strategic priorities, with plans to increase branch lender numbers by up to 50 per cent over the next five years.
The bank also plans to extend Saturday trading hours at selected branches, alongside further investment in mortgage sales capabilities and training.
[Related: Businesses are struggling, but demand for finance keeps rising]
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