ANZ shares charge higher on $57.5 million class action settlement news

ANZ shares have continued their positive run on Monday.

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ANZ Group Holdings Ltd (ASX: ANZ) shares are starting the week positively.

In morning trade, the banking giant's shares are up almost 1% to $29.29.

Why are ANZ shares rising?

There are a couple of reasons why the bank's shares are pushing higher on Monday.

The first is that the banking sector is having a particularly positive start to the week. This has seen all the big four and regionals rise this morning, driving the S&P/ASX 200 Financials sector higher.

In addition, there was some news out of ANZ today that may have given its shares a boost.

What did ANZ announce?

This morning, ANZ announced that it has reached an agreement to settle a class action brought against it by Phi Finney McDonald in 2021.

This class action relates to certain interest charged on some ANZ personal credit cards in the period from 1 July 2010 to 1 January 2019.

As a reminder, the claim alleged that ANZ charged interest to customers retrospectively on credit card purchases that previously had the benefit of an interest-free period.

The claim further alleged that ANZ did not provide transparent instructions to its interest-free credit card customers of the manner in which it charged retrospective interest and that customers had no ability to determine the amount they would pay.

According to the announcement, ANZ has agreed to pay $57.5 million to settle the claim.

The good news is that this amount is fully covered by a provision that was held at 30 September 2023.

ANZ also advised that the "settlement is without admission of liability and remains subject to court approval."

Following today's gain, ANZ's shares are now up an impressive 30% over the last 12 months. To put that into context, a $20,000 investment a year ago would now be worth approximately $26,000. And that doesn't include the dividends the bank has paid to its shareholders over the period.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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