The Australia and New Zealand Banking GrpLtd (ASX:ANZ) share price is trading lower today after announcing an $817m earnings impact…
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The Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price is trading lower on Friday morning.
At the time of writing, the banking giant’s shares are down 0.3% to $28.85.
Why is the ANZ share price trading lower?
The ANZ share price has come under a spot of pressure this morning after the bank released an update on notable items that will be included in its upcoming first half results.
According to the release, ANZ’s first half cash earnings after tax will be impacted by $817 million of notable items. This is the equivalent to ~5 basis points of CET1 capital.
This $817 million includes previously announced items totalling $260 million and $557 million of new items.
In respect to the previously announced items, these include $48 million after tax for a class action settlement in the United States and $212 million after tax relating to equity accounted losses from AmBank.
What are the new items?
There are four new items impacting ANZ’s cash earnings.
The first is a further $135 million after tax impact from equity accounted losses from AmBank. This relates to goodwill impairment recognised by AmBank at 31 March 2021.
The largest is a $251 million after tax item relating to the write-down of goodwill attributable to the ANZ Share Investing business. This is a result of this business being reclassified as held-for-sale, reflecting a continuation of the bank’s simplification strategy.
The third item is $108 million after tax of additional customer remediation charges.
And finally, ANZ will recognise restructuring charges and other smaller divestment impacts of $63 million after tax.
When does ANZ release its results?
ANZ is scheduled to release its results on Wednesday 5 May. And with the ANZ share price up 25% since the start of the year, expectations certainly are high.
As I mentioned here, Goldman Sachs is expecting the banking giant to report first half cash earnings (pre-one offs) of $3,073 million. This will be a 117% increase on the prior corresponding period, which was impacted greatly by COVID-19.
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Motley Fool contributor James Mickleboro 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 Bruce Jackson.