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  • ANZ’s (ANZ) full-year net profits have fallen 40 per cent to $3.58 billion
  • The bank pointed towards the difficult 2020 year, referencing Australian bushfires and the ongoing COVID-19 pandemic
  • The bank also released an ambitious new climate policy, supporting a zero-emission economy by 2050
  • Effective immediately, ANZ will cease lending money to businesses that draw over 10 per cent in profits from mining and generating thermal coal
  • However, the plan has been criticised by both the Minister for Agriculture and clean energy campaigners
  • Shares in the bank fell 2.4 per cent during Thursday trade to close at $18.70 apiece

Full-year net profits for the Australian and New Zealand Bank (ANZ) have dropped 40 per cent to $3.58 billion.

ANZ Chief, Shayne Elliot, steered the conversation towards the tumultuous 2020 year plagued by the COVID-19 pandemic.

“We could never have forecast 2020, a year that started with devastating bushfires in Australia and unwound with the waves of a pandemic that continues today,” he said.

“While we still cannot predict its course, we remain confident we can
deal with its impacts,” Shayne continued. “COVID-19 is contained in New Zealand and we remain well-positioned to benefit from its subsequent economic recovery.”

Ultimately, ANZ’s massive drop in net profits was also coupled with a depressing cash profit: falling 42 per cent to $3.67 billion.

ANZ shareholders can also expect a decreased dividend this time around: 35 cents per share, compared to last year’s 80 cents per share.

The dividends will be paid on December 16.

New climate policy

Perhaps the biggest news from ANZ’s Thursday media blitz is the unveiling of a progressive and ambitious new climate change policy.

Effective immediately, the bank will cease lending money to any clients that earn over 10 per cent of revenue from thermal coal mining, or generation of thermal coal.

The bank pledges this to help phase out thermal coal use by 2030. Also according to ANZ, this policy seeks to support a zero-emissions economy by 2050.

“Reducing carbon emissions is fundamental,” ANZ Group Executive, Mark Whelan, wrote. “It is a shared responsibility for every sector of the economy, requiring collaboration between government, business and industry”.

Whelan named the Paris Agreement as a direct influence to the new policy.

“As a bank, ANZ understands the impact – positive and negative – our financing has on climate change,” he continued.

“We are in a unique position, through our lending decisions, to support customers and projects that reduce emissions as well as support economic growth,” he stated.

The bank also sought other ways to put renewable energy in the front seat, saying loans to the construction of office buildings would only be granted with visible support of energy efficiency.

Although ANZ’s new policy hasn’t hit the mark for every critic.

Australian Minister for Agriculture, Deputy Leader of the Nationals Party David Littleproud, said the plan was detrimental to the country’s farmers.

“Banks are not and should not try to become society’s moral compass and arbiter – the Australian people decide that by who they elect,” he said.

“We can’t let unelected, profit-driven financiers from Pitt Street dictate to society how to produce food and fibre or how we run our economy,” the Minister continued.

Littleproud also called the policy “virtue signalling” and said that ANZ was “out of touch.”

Other criticism was also drawn by the clean-energy campaigner, Market Forces.

Although ANZ’s Mark Whelan cited influence from the Paris Agreement, Market Forces said the plan was late and inconsistent in that regard.

“ANZ has given coal companies a further five year window to plan business diversification,” the organisation put in a written statement.

“[…] The bank’s policies remain woefully inconsistent with the Paris Agreement, allowing it to fund companies which continue to expand the fossil fuel industry, such as those exploring and exploiting new oil or gas fields.”

ANZ’s full-year roundup will be followed by Westpac on Monday, and NAB on Thursday this week.

Shares in the bank fell 2.4 per cent on the Australian market during Thursday trade. They closed at $18.70 apiece.

ANZ by the numbers
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