ANZ FY26 result: cost savings beat target as returns lift
In a CFO interview released with its FY26 full year result, ANZ Group outlined a first year of its ANZ 2030 strategy that delivered cost savings above target, a lower cost to income ratio and a higher return on tangible equity. Chief Financial Officer Farhan Faruqui spoke with Alicia Muling, Senior Journalist of bluenotes, in a transcript released on 9 November 2026.
Faruqui said the bank has been through “the first 20 per cent” of what it wants to do from a strategy point of view. He described ANZ as “halfway through the first phase”, which he said covers simplification, resilience and the start of delivering value for shareholders.
Cash profit grew 10 per cent in one year, excluding the impact of significant items recognised in 2025. Faruqui pointed to these measures as delivery on commitments made a year earlier:
- Cost to income ratio improved by about 400 plus basis points in one year
- Return on tangible equity up by over 100 basis points
- Cash profit up 10 per cent, excluding significant items recognised in 2025
- Cost reduction beyond the $800 million target
Farhan Faruqui, Chief Financial Officer
“…we’re going into 2027 in a much better shape than we went into 2026.”
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Dividend steady at 83 cents with higher franking
Faruqui said ANZ announced a stable dividend of 83 cents per share. The franking element improved from 70 per cent at the end of last year to 80 per cent in the final dividend this year, which he called a “substantial change”.
| Measure | End of last year | Final dividend this year |
|---|---|---|
| Franking | 70 per cent | 80 per cent |
| Dividend per share | n/a | 83 cents |
For what each element means, see how to read an ASX dividend announcement.
Second half momentum across the divisions
Structural cost reset
On costs, Faruqui said ANZ delivered over $900 million of cost reductions against the $800 million target set a year earlier. On an annualised basis, that equates to more than $1 billion of sustained cost out of the bank.
He called it a “major cost, structural reset”. He said it shows a more sustained framework to deliver discipline on cost going forward.
Balance sheet growth
Faruqui said the second half brought more balance sheet momentum, with three drivers:
- Home loan growth returned to system, which he attributed to better service, better SLAs and improved process and turnaround times.
- Business & Private Bank showed momentum in lending and deposit growth.
- The Institutional bank delivered operational deposit growth, adding to growth in its payments and cash management business over the last few years.
The divisional reporting changes introduced for FY26 moved the bulk of ANZ’s home loan book into Business & Private Bank, which affects how divisional momentum is read against restated FY25 comparatives, although group cash profit was left unchanged.
Markets
Faruqui described a “good, solid Markets year”. The fourth quarter was a softer trading environment, with customers stepping back in an uncertain environment and reassessing their hedging and risk management needs.
He said that reduced some volumes and some of the tenors customers hedge out to. Despite that, he said ANZ delivered a strong solid outcome in the second half.
Watchpoints and priorities for FY27
Two measures anchor the year’s result. The cost to income ratio shows how much of each dollar of income a bank spends on running costs, so a lower figure means more income is retained. Return on tangible equity measures profit against shareholders’ tangible capital, so the lift of over 100 basis points points to higher returns on that capital.
Faruqui named four watchpoints for the external environment:
- Higher rates, and how customers manage their risks, costs and businesses, while keeping the portfolio resilient.
- Competition, with ANZ not growing volumes “at the cost of margins, at the cost of returns”.
- The geopolitical environment and its effect on how customers hedge their businesses.
- Going into this environment with a solid position in the balance sheet and capital.
The immediate priorities he named include Suncorp Bank integration and a single customer front-end. He said ANZ also wants to progress further toward its 2028 targets, and ultimately its 2030 targets.
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