ANZ has warned its cash earnings per share could fall by 20 to 25 per cent in 2008 on the back of increased bad debt provisions.
In a trading update provided to the ASX today, ANZ said credit impairment provisions in the second half of 2008 were likely to be around $1.2 billion, from $980 million in the first half.
Mike Smith, ANZ CEO, said the bank’s underling business was performing well and a cash profit of over $3 billion was expected, but he said it was wise to take a more conservative approach in the current market conditions.
“As the deterioration in global credit markets continues and the slowing of the global economy plays out in Australia and New Zealand, there are flow-on effects for our commercial portfolios and to a lesser extent the personal portfolios.”
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