ANZ’s Progress Report from Promontory: A Deep Dive
ANZ’s first progress report from Promontory on its People, Accountability, Customers and Trust Program (PACT) has left industry observers with some uncomfortable food for thought. The report paints a picture of a bank grappling with the need for major improvements in non-financial risk management and culture, a necessity underscored by ANZ’s Court Enforceable Undertaking with APRA in April 2025. This undertaking was a direct result of a settlement following a series of episodes of misconduct by the bank.
ANZ’s Misconduct and Penalties
The previous year, ANZ was handed a hefty penalty of $240 million by the Federal Court due to four separate incidents of misconduct. The most egregious of these was ANZ’s unethical conduct in its dealings with the Australian Government during the management of a $14 billion bond deal. The bank was found to have overstated bond trading volumes by tens of billions of dollars over a period of nearly two years.
Further adding to ANZ’s woes were three additional misconduct matters relating to retail banking. These included the bank’s failure to respond to customer hardship notices, making false and misleading statements about its savings interest rates, failing to deliver the promised interest rates to tens of thousands of customers, and neglecting to refund fees charged to thousands of deceased customers’ accounts. The bank also failed to respond within the required timeframe to those dealing with the deceased estates.
The PACT Progress Report: An Overview
The PACT progress report breaks down into seven workstreams, only two of which have received a Green rating. Four have been classified as Amber, and one is marked Red. Each workstream is made up of several Deliverables, with each Deliverable in turn comprising several Activities. These Activities are categorised as either Design, Implement, or Embed Activities. In total, there are 32 Deliverables made up of 151 Activities across the seven workstreams.
According to Promontory, as of the reporting date, the delivery of PACT was progressing as planned. Activities were meeting scheduled timelines, and ANZ had submitted its first two Closure Packs to Promontory in line with the Plan. However, by the end of February, only 15 Deliverables were rated Green, with 15 Amber and two Red.
Challenges and Risks Ahead
One area of concern is program resourcing, which continues to be rated Red, indicating ongoing resourcing and capability gaps. Promontory also points to significant organisational restructuring and high levels of change fatigue among certain cohorts as potential stumbling blocks.
The adequacy of funding for the program is another critical risk. Promontory reports that the program’s financials deteriorated to an Amber status, reflecting emerging issues with Group Risk’s Financial Year 2026 financials. Despite these challenges, the program continues to deliver within its FY2026 funding envelope, including the approved Program contingency.
Looking ahead, the complexity of the program is expected to increase as it moves further into implementation. Future packages will encompass a broader range of activities, demand more from divisions, and will likely have a larger impact on the business. As activity intensifies, the report emphasises the need to manage workload sustainability and the potential emergence of people-related risks.
In conclusion, the PACT progress report illustrates a challenging road ahead for ANZ as it strives to improve its non-financial risk management and risk culture. The bank’s ongoing commitment to the PACT program and its willingness to address the issues brought to light in the report will undoubtedly be closely watched by industry observers and stakeholders alike in the coming months.
For the full report and more detailed insights, visit the original source Here.
