ANZ Banking Group FY26 first take: Slight beat to JPMe but capital softer on one-off hedging activity

ANZ's FY26 result was a 1% beat to JPMe at both PPOP and Cash NPAT. On a constant currency basis and excluding one-offs, revenue growth was +3% yoy, cost growth was -4% and PPOP was +11%, driving 110bps of UL ROTE expansion to 11.6%. Revenue and NIM were in line with JPMe, with Markets a small headwind; opex was 1% better than JPMe and credit costs were in line at 7bps BDD/GLA. The CET1 ratio of 12.0% was an 8bps miss to JPMe and a bigger miss to consensus, driven by ANZ pre-rolling its replicating portfolio to favourable interest rates, a headwind expected to wash out in the near term. Management guided to flat yoy costs on the pro-forma post-Worldline cost base of $11.26bn and flat NIM hoh ex Markets in 1H27, slightly better than JPMe's -1bp. Credit quality trends remained benign with an improvement in the wholesale control list, while CP/CRWA coverage fell 2bps hoh to 1.20%, at the low end of peers. Overall we expect little change to consensus forecasts.