Owning ANZ Group Holdings Ltd (ASX: ANZ) shares usually means getting a good level of passive income. But can it deliver earnings growth? That could be essential for whether the ANZ share price rises or not in the next year or two.
The ASX bank share has been working hard to reduce its cost base, be more efficient, and deliver good performance with its market share.
ANZ has a lot of competition in the banking space, who all want market share, including Commonwealth Bank of Australia (ASX: CBA), Macquarie Group Ltd (ASX: MQG), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB), and so on.
A lot of competition may be a headwind for the bank in terms of both growing market share and a strong net interest margin (NIM). But that hasn't stopped ANZ from generating strong profit growth in the near term.
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FY26
The 2026 financial year has finished for many companies, but for ANZ, it doesn't finish until 30 September 2026.
The latest update we've heard from the bank was very promising for what the FY26 result could reveal.
In HY26, compared to the second half of FY25, ANZ reported in cash profit terms that operating income grew 3% and operating expenses fell 22%, leading to profit before provisions jumping 51%. It also noted that the (loan) provision charge reduced 7% and the cash profit soared 70%.
However, some of those numbers received a large boost due to 'significant items'. Excluding significant items, operating income was flat, operating expenses dropped 9%, profit before provisions grew 12%, and cash profit rose 14%. Customer deposits increased by 3%, while net loans and advances fell by 1%.
I think any of Australia's domestic banks (excluding Macquarie) would be delighted to report double-digit net profit growth.
The bank is forecast to grow its earnings per share (EPS) in FY26, according to the projection on CommSec. The EPS could reach $2.559 in the 2026 financial year, putting the ASX bank share's valuation at around 14 times FY26's estimated earnings.
FY27
I think it's a great sign to see a business grow earnings, as that's what justifies higher share prices and larger dividends.
The bank is forecast to deliver earnings growth in the 2027 financial year. However, the current projection is not very exciting.
According to the estimate on CommSec, the ASX bank share is projected to very slightly increase its EPS to $2.561 in FY27. In other words, profit is forecast to be virtually flat. That would mean it's trading at 14 times FY27's estimated earnings as well.
The CommSec collation of analyst opinions on the business revealed there are currently two sell ratings, eight hold ratings, and six buy ratings. The experts are more positive than negative, though there could be even better opportunities out there.
