ANZ profit rises to $2.97 billion, but margins thin: Midday roundup

ANZ Banking Group has lifted its first half profit by 1% to $2.92 billion but says margins in its Australian business are declining.

The bank will not yet confirm if it will pass on the Reserve Bank rate cut. 

ANZ’s net profit for the six months to March 31 increased from $2.66 billion in the previous corresponding period.

“In an increasingly challenging environment, ANZ has produced a solid financial result in the first half that continues progress in executing our super regional strategy,” chief executive Mike Smith said in a statement.

“Our financial performance, however, was subdued; significantly impacted by declining margins and the structural shift that’s occurred since the financial crisis with persistently lower demand for credit.”

Optus to scrap 750 jobs in reshuffle

Telco giant Optus will shed 750 jobs as part of a corporate restructure it says will provide the business with greater efficiency.

Optus said the harsh trading environment mandated the cuts, and that most would come from senior and middle management, back office and administrative divisions, which will result in a one-off charge of $37 million consisting of items such as paid out leave entitlements.

Kevin Russell, chief executive of the company’s new consumer division, said the trading environment requires Optus to reduce its costs.

“However, a key driver of the restructure has been a desire to elevate the voice of our ten million customers to ensure they are heard loud and clear in every area of our business: in our service delivery and support; in the products and services we bring to market; and in the consistent experience we provide across all our sales channels,” he said.

“By creating a more efficient organisation with a renewed focus on the customer, we will be able to compete more effectively.”

Shares flat despite good Wall Street lead

The Australian sharemarket is flat this morning despite a boost yesterday from the RBA rate cut, and a good lead from the United States where manufacturing data has improved.

The benchmark S&P/ASX200 index was up 2.3 points or 0% to 4431.8 at 12.00 AEST, while the Australian dollar has dropped to $US1.03c.

In the United States, the Dow Jones Industrial Average rose 65 points or 0.5% to 13,279.3.

Swan denies Labor leadership movements

Treasurer Wayne Swan has said the idea of any change in the Labor leadership is a “heap of rubbish”.

“I just regard the reporting of opinion polls as a whole heap of rubbish,” he told ABC Radio this morning.

The comments come as some reports have indicated MPs are dissatisfied with Julia Gillard’s approach to the Slipper and Thomson controversies, and want a leadership change.

“Julia Gillard is getting things done, she’s doing them in the most extraordinary way in difficult circumstances,” Swan told Sky News. “She’s got the runs on the board.”

“I’ve ruled out any of these discussions going on as far as I am aware,” he told ABC Radio.