Australia and New Zealand Banking Group (ASX: ANZ) and Westpac Banking Corp (ASX: WBC) shares are offering enormous dividends to share market investors.

Despite its recent woes, ANZ Banking Group is expected to offer a dividend of $1.61 per share in the year ahead, equivalent to a dividend yield of 6.4% — fully franked.

That’s a substantial premium to term deposits and savings accounts which at most major banks are offering around 2%.

Meanwhile, Westpac shares are also in the race for your investment dollars. With a forecast dividend payment of $1.88 (fully franked), its shares are expected to yield 6.3%. Grossed up for those franking credits, its yield increases to 9%. If you’re investing in a low tax structure like a self-managed superannuation fund (SMSF) the benefit of dividends cannot be overlooked.

Why I’m avoiding these two ASX bank shares

While ANZ Banking Group and Westpac Bank shares appear fantastic investments on first glance, there are reasons why they are cheap.

Much of the market’s uncertainty likely stems from their recent share price falls. Both ANZ and Westpac shares have fallen 10% in 2016 and underperformed the market, or S&P/ASX 200 (Index: ^AXJO) (ASX: XJO), by similar amounts.

However, the expectation of cooling property prices, increasing bank regulation, falling dividend payments and rising competition are adding further doubt to their outlooks.

Personally, I think it’s too early to buy shares in either bank — especially if you are already meaningfully exposed to the sector — because the risks appear weighted to the downside at today’s prices.

Indeed, while shares in both banks appear attractive income investments, I’m holding off until the end of the year before taking any action.

In the meantime, I'm looking for other - faster growing - dividend shares to add to my portfolio, like the one The Motley Fool's expert analysts hand-picked as their best dividend share idea for 2016.

Indeed, our resident dividend experts named their Top Dividend Share for 2016. Not only are the shares dirt cheap, the company is growing and trading on a 5.6% fully franked dividend yield. Simply click here to gain access to this comprehensive FREE investment report, including the name of this fast growing ASX dividend share. No credit card required!

HOT OFF THE PRESSES: Motley Fool’s #1 Dividend Pick for 2017!

With its shares up 155% in just the last five years, this ‘under the radar’ consumer favourite is both a hot growth stock AND our expert’s #1 dividend pick for 2017. Now we’re pulling back the curtain for you... And all you have to do to discover the name, code and a full analysis is enter your email below!

Simply enter your email now to receive your copy of our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2017.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our https://www.fool.com.au/financial-services-guide">Financial Services Guide (FSG) for more information.

Motley Fool Contributor Owen Raszkiewicz does not have a financial interest in any company mentioned in this article. Owen welcomes -- and encourages -- your feedback on Google+, LinkedIn or you can follow him on Twitter @ASXinvest.

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.