ANZ Profit Down -23%, Waffle on Outlook

ANZ today unveiled a -23% drop in cash earnings which had largely been flagged to the market well in advance. Basically ANZ suffered from a few large exposures to weapons of finacial mass destruction as NAB did. As can be seen below those exposures led to a huge spike in credit loss provisions.

On the all important outlook for 2009, ANZ bascially admitted that they don't have a clue.:

Commenting on the 2009 outlook for ANZ, Mr Smith said: “Market conditions globally remain difficult and unpredictable. The restructure of our business announced in September is designed to accelerate progress with our Super Regional Bank strategy, lift customer focus and drive performance improvement.

“Managing a large commercial bank means managing through a range of conditions. While we expect choppy conditions to continue in 2009, ANZ is well positioned to manage this cycle, to continue to invest and maximise the opportunities which arise.

“We have the foundation, a clear direction and the capacity to deliver performance and value to our shareholders over the longer term,” Mr Smith said.

That is corporate speak for we don't have a clue. Again, as with NAB if you think these these banks are relatively stable and can maintain earnings and therefore dividend levels then they may not be such a bad place to be as interest rates continue to be cut. However, given the outlook for credit can how much certainty can you put in that scenario playing out?