SYDNEY, Feb 26, 2026, 17:38 AEDT — Market closed
- ANZ ended up 0.8% at A$39.98, near the day’s high
- Bank said former CEO Shayne Elliott discontinued legal action over FY2025 pay
- Hotter core inflation has markets leaning toward another RBA hike in May
ANZ Group Holdings Limited shares closed up 0.8% at A$39.98 on Thursday, after trading between A$39.55 and A$40.06, as investors weighed a fresh legal update and a stickier inflation backdrop. (Intelligent Investor)
The move matters because ANZ is trying to keep attention on banking basics — margins, costs and credit — not a pay dispute involving the former boss. It’s the sort of issue that can hang around even when the numbers look clean.
Rates are the other live wire. Bank earnings hinge on net interest margin, the gap between what lenders earn on loans and pay for deposits and other funding, and that can shift quickly when policy expectations move.
ANZ said earlier this week that former chief executive Shayne Elliott had discontinued legal proceedings tied to remuneration outcomes in the 2025 financial year. The bank said no payments or commitments were made to Elliott and both sides will bear their own costs. (ANZ)
Elliott sued in December after the bank cut $13.5 million from his bonus payments after retirement, ABC News reported at the time. He ran ANZ from 2016 until May 2025. (ABC News)
Australia’s monthly CPI rose 0.4% in January and the annual pace held at 3.8%, while the trimmed-mean core gauge — which strips out extreme price moves — lifted to 3.4%, a 16-month high. Investors priced an 80% chance of a May rate increase after the Reserve Bank lifted the cash rate by 25 basis points (0.25 percentage point) earlier this month to 3.85%, Reuters reported. Deloitte Access Economics partner Stephen Smith said the trimmed mean was “still too high”, while EY chief economist Cherelle Murphy said the central bank “has its work cut out”. (Reuters)
Higher rates can help margins at first, but they also raise the risk that borrowers start to strain and funding costs climb. Bank stocks don’t like surprises, and the rate story has been full of them.
For the big four — ANZ, Commonwealth Bank, National Australia Bank and Westpac — valuation has become the loudest argument in broker notes. A Market Index digest of Macquarie and Morgan Stanley research put the sector’s average price-to-earnings multiple around 21 times, and said past RBA tightening cycles have consistently triggered de-ratings; it also flagged ANZ as cheaper than peers while warning competition in home loans and deposits could bite later. (Market Index)
But the upside case leans on the economy staying steady and bad debts staying low. If the rate outlook hardens or growth cools faster than expected, credit losses can normalise quickly and bank multiples can shrink.
Before the next session, traders will keep one eye on bond yields and any fresh RBA guidance for May. For ANZ, the next hard date is May 7, when it reports half-year results, with the interim dividend set to go ex-dividend on May 18, the bank’s calendar shows. (Anz)
