The Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price has been in a horizontal channel of late. This has led investors to believe that the banking giant is now fully valued, trading at the same levels pre-COVID.
At market close on Wednesday, ANZ shares finished up 0.88% at $27.51.
ANZ dethroned as Australia’s fourth largest bank
As the ANZ share price has traversed sideways, Macquarie Group Ltd (ASX: MQG) shares have picked up steam in 2021.
At present, ANZ is valued at approximately $76.87 billion, whilst the global investment bank is worth $77.68 billion. This puts it behind leader Commonwealth Bank of Australia (ASX: CBA) with $165.21 billion, National Australia Bank Ltd (ASX: NAB) at $93.21 billion, and Westpac Banking Corp’s (ASX: WBC) $80.01 billion.
The reshuffle could also see Macquarie overtake Westpac, given its market capitalisation is not too far ahead. The third pole position would represent another symbolic change and put the company further in the spotlight.
Notably, Macquarie shares have increased by almost 50% in 2021, zooming past the psychological $200 barrier in late October. On the other hand, ANZ shares have gained a paltry 20% in the same period, recovering from COVID-19 lows.
While Macquarie is a different kettle of fish compared to the other major banks, there is no real direct threat. The company’s primary business is asset management providing investment solutions as opposed to retail banking like its peers.
In addition, Macquarie has been investing heavily in renewable energy as the world moves towards decarbonisation. The global push in targeting net-zero emissions could see the company reap huge rewards for its early-adopter approach.
Nonetheless, ANZ still maintains a dominant position within the retail banking industry servicing millions of customers in Australia and New Zealand.
In its FY21 financial results, the company recorded statutory net profit after tax of $6,162 million. This represented a 72% jump over the prior corresponding period. In contrast, Macquarie achieved $3,015 million for the last financial year.
ANZ share price snapshot
For most of 2021, the ANZ share price has continued to move sideways, registering a 21.45% gain. When factoring in the last 12 months, its shares are actually up less than that, up 20.03%.
On valuation grounds, ANZ presides a market capitalisation of approximately $76.87 billion, with 2.82 billion shares on its books.