Australia and New Zealand Banking Group Ltd.

The rating outlook on ANZ is stable. Australia's economic prospects over the next two years are sound. This is despite subdued GDP growth due to elevated interest rates and the slowing economies of major trade partners. We forecast unemployment in Australia will increase somewhat but remain low in a historical context. We expect modest growth in house prices over the period. Strong immigration-driven population growth along with limited new housing supply should continue to support house prices. ANZ should maintain sound earnings and its credit losses should remain low, at about 15 basis points (bps) of customer loans. If the proposed acquisition of SML is completed, we expect our RAC ratio for ANZ to fall--but remain strong at 11.0%-11.5% over

...Australia and New Zealand Banking Group Ltd.'s (ANZ) strong market position and focus on low-risk lending in Australia and New Zealand will continue to support its earnings. The bank focuses on retail and commercial banking. Despite rapid increases in consumer prices and interest rates, we see a sound outlook for the economies of both countries. ANZ Group Holdings Ltd. is the non-operating holding company (NOHC) of the consolidated ANZ Group. The banking subgroup drives ANZ group's stand-alone credit profile (SACP). This is because it forms the predominant part of the ANZ Group. ANZ's capitalization will remain a credit strength. We project the risk-adjusted capital (RAC) ratio for the bank will remain strong at 11.0%-11.5% over the next 24 months. This represents a fall from 12.7% as of March 31, 2024, due to the completion of ANZ's acquisition of Suncorp-Metway Ltd. (SML) likely by July 31, 2024, as well as a A$2 billion...

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