
Monoline costs ANZ $200 million
In a shareholder update after four months of trading, released on February 18, the bank stated that it had no direct exposure to US subprime mortgages, and expects to write back a significant proportion of the provisions in future periods. ANZ chief executive Mike Smith said: “We believe the accounting treatment - which requires that banks account for the losses on derivatives - overstates the likely loss over the life of the transaction.”
The credit crisis has also forced ANZ to add US$90 million to its provision that loans might fail, because of its dealings with an unnamed commercial property client that has suffered significant credit rating downgrades. A further US$51 million due to failures of a resources client was also added to the losses.
ANZ's interim results are due on April 23.
See also : Dragged down
Credit crisis losses could reach $400 billion
Monolines in a world of pain
Safe from subprime?
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