ANZ shares are up as the bank starts a $1.5 billion buy-back

Photo: William West/AFP/Getty Images

The ANZ Bank today announced a $1.5 billion share buy-back.

The bank says it has completed the sale of its 20% stake in Shanghai Rural Commercial Bank, originally announced in January, and now intends to buy back up to $1.5 billion of shares on-market.

A short time ago, its shares were up 1.3% to $28.59.

“ANZ’s strong capital position combined with the progress made in simplifying our business means we are now in a position to commence returning surplus capital to shareholders while still complying with APRA’s unquestionably strong capital requirements,” says ANZ chief financial officer Michelle Jablko.

ANZ has already bought $500 million shares on-market to neutralise the effect of the dividend reinvestment program for both the interim and final 2017 dividends as well as the impact of ANZ’s share-based employee compensation plans.

The bank is on a campaign of selling off non-core businesses. Last week it announced the $2.85 billion sale of its life insurance business to the local arm of global financial services company Zurich.

The latest sale was another step in ANZ’s strategy to create a bank focused on retail and business banking in Australia and New Zealand, and Institutional Banking across the region.

Shayne Elliott, who in January 2016 replaced former CEO Mike Smith who was big on building an Asia business, has pulled the bank away from retail banking in the region to focus on institutional customers.

The latest share buy-back is expected to begin in January.

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