ANZ slashes application footprint, continues Agile push

Decommissions hundreds of applications

In FY18 ANZ decommissioned 264 applications as part of the bank’s broader simplification push.

The figure represents a 35 per increase on the prior year, the bank said in its results for the 12 months ended 30 September.

The bank revealed it had also decreased its capitalised software balance from A$2.9 billion in 2015 to $1.4 billion today, which ANZ said is the lowest of Australia’s big four banks.

“We no longer mortgage our future with rising and unsustainable software capitalisation and we’ve moved from having the highest software balance of our peers to the lowest,” CEO Shayne Elliott told a briefing on the bank’s full year results. “We still spend the same amount on technology we just pay for it in the year we build it.”

During the year technology expenses grew 19 per cent to $1.9 billion; the bank said that $251 million of that was due to accelerated amortisation for software assets and the rest primarily related to increased investment in digital and data capabilities.

The bank said that technology highlights during the year included the introduction of artificial intelligence (AI) technologies to improve customer engagement and operational efficiency.  ANZ said its institutional bank had introduced “machine learning and robotics” with 30 per cent of trade transaction processing now relying on the technologies. As a result, customer turnaround time has improved by around 40 per cent, the bank said.

In July, the bank in New Zealand launched ‘Jamie’: A digital assistant using avatar technology developed by Soul Machines.

ANZ during the year also rolled out support for the New Payments Platform to 3 million business customers. The NPP had its public debut in February. The platform facilitates real-time clearing and settlement and also supports data-enhanced payments and an addressing scheme dubbed PayID.

In February the ANZ App launched — a successor to the bank’s goMoney and Grow mobile apps. Some 2.2 million goMoney users have been shifted to the new app, ANZ said.

ANZ now has 3.5 million “digitally active” customers in Australia and 114 digital branches — 18 per cent of its branch fleet.

Elliott said that some 26 per cent of the bank’s employees now work in an “Agile manner” as part of ANZ’s ‘New Ways of Working’ program. The Agile approach “increases speed of delivery, improves engagement, drives productivity and strengthens accountability,” the CEO said.

ANZ said that restructuring expenses of $227 million for the year largely related to the Agile push.

The bank in 2017 first detailed its Agile push. Last month the bank revealed it had partnered with software company Atlassian as part of the program.

ANZ said that more than 9000 people across the group are working in Agile teams (though that figure includes both ANZ employees and managed services, the bank said).

ANZ reported a statutory profit after tax of $6.4 billion for the year. Cash profit on a continuing basis was down 5 per cent to $6.49 billion.

“Retail banking in Australia faced strong headwinds with housing growth slowing and borrowing capacity reducing. We continued our disciplined approach to home loan growth by focusing on customers who want to buy and own their own home,” Elliott said in a statement.

“While this meant we sacrificed short-term revenue growth and higher margins in Australia, particularly in the investor and interest-only segments, it was the right thing to do for shareholders.”