ANZ reports that its move to integrate two core banking systems in New Zealand have gone smoothly, but financial results released today revealed the banking group continues to incur costs more than a year after the project was expected to be completed.
The bank’s quarterly trading update reveals it incurred an additional $18 million in expenses on the project during the quarter, bringing the total project cost to $210 million for 2012.
“The simplification program is delivering productivity benefits including reductions in technology operating costs,” the bank said in a statement, after posting a $1.53 billion first quarter cash profit.
The project pushed the FIS Systematics platform across both ANZ's NZ brands (ANZ Bank and The National Bank). It kicked off in November 2010 and was scheduled to be completed by the end of 2011.
The new platform wasn’t switched on until October 2012 after it was postponed to allow more time for testing, development and training.
The integration of the two brands continues to impact ANZ’s operating margins in New Zealand, and chief financial officer Shayne Elliott today told analysts it helped explain a large part of the drop in the bank’s cost to income ratio.
In October last year ANZ announced plans to spend $1.5 billion on a technology-heavy “Banking on Australia” program, which will include the rollout of intelligent ATMs, video conferencing and an Android NFC trial.
ANZ chief Mike Smith today reiterated that the banking sector in Australia was in “rather less exciting times”, with consumer and business confidence remaining weak despite low unemployment and low interest rates.