ANZ agrees to APRA undertaking, Oliver Wyman report released

Australia and New Zealand Banking Group (ANZ) has entered a court-enforceable undertaking (EU) with the Australian Prudential Regulation Authority (APRA) related to non-financial risk management and risk culture, which includes an additional operational risk capital overlay of AUD250 million. The EU follows concerns from APRA regarding ANZ's non-financial risk practices and risk culture. Simultaneously, ANZ released a report from Oliver Wyman, which reviewed the culture and risk governance within its Global Markets business. While the Oliver Wyman review found no evidence of widespread misconduct, it did identify shortcomings in leadership, inconsistent risk management, and a variable culture, that did not always constrain inappropriate behavior. ANZ has committed to addressing the issues raised by APRA and the Oliver Wyman Report, including the appointment of senior executives to strengthen non-financial risk management. The EU will involve an independent reviewer to assess these shortcomings, with a remediation plan based on the reviewer's findings. ANZ expects the changes required to comply with the EU will not have a material impact on the Group's cost outlook.