ANZ share price lower following 1Q FY25 report

The banking giant has released its first quarter and pillar 3 reports today.

The ANZ Group Holdings Ltd (ASX: ANZ) share price is down 2.99% to $29.23 after the bank released its 1Q FY25 report.

The other major banks are also down, and the S&P/ASX 200 Index (ASX: XJO) is 1.32% lower.

Let's take a look at ANZ's first-quarter numbers.

A couple sits on a sofa, each clutching their heads in horror and disbelief, while looking at a laptop screen.

Image source: Getty Images

ANZ share price falls on Thursday

ANZ reported a 2% overall increase in customer deposits, with all retail and commercial divisions, including NZ and Suncorp Bank, experiencing increases of between 1% and 5%.

There was a 3% increase in institutional payments and cash management (PCM) deposits.

Total institutional deposits (ex-markets) were broadly flat, with PCM increases offset by a fall in term deposits.

There was a 4% increase in net loans and advances. ANZ said the majority of this growth was in its institutional division.

ANZ's Risk Weighted Assets (RWA) increased by 6%.

This was due to about $18 billion in credit RWA growth, about $15 billion from portfolio volume and mix changes, about $4 billion FX, and a $6 billion increase in the IRB Capital Floor Adjustment.

The bank said its Exposure at Default (EAD) increased by 6%.

This was mainly due to an 11% increase in the sovereign and financial institution asset class and a 7% increase in the corporate and specialised lending asset class.

Residential mortgages grew by 1% over the quarter.

Gross impaired assets (GIA) rose by $200 million to $1.9 billion, mainly due to Australian mortgage restructures.

What about the Pillar 3 report?

ANZ also released its APS 330 Pillar 3 Disclosure today, as per the Basel III framework requirements set by the Australian Prudential Regulation Authority (APRA).

The pillar 3 report covers market discipline, transparency, and disclosure.

ANZ reported $379.4 billion in credit-risk-weighted assets (CRWA) as of 31 December. This was an $18.2 billion increase quarter over quarter.

The bank attributed this to volume growth, mainly in the institutional business from foreign exchange rate changes impacting market exposures, along with corporate finance lending growth and transaction banking trade.

ANZ said its traded market risk RWA increased by $1.1 billion, primarily due to increased stressed value at risk (VaR).

Stressed VaR is the measure of market risk in strained market conditions.

The bank's interest rate risk in the banking book (IRRBB) RWA fell by $1 billion due to improved embedded losses.

The operational risk RWA rose by $1 billion due to the annual refresh under APS 115 prudential requirements and the bank's improved financial performance in FY24.

ANZ share price snapshot

The ANZ share price has increased by 4.8% over the past 12 months.

This is an underperformance compared to the broader market, with the ASX 200 up 8.4% over the period.

Motley Fool contributor Bronwyn Allen 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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