ANZ chief executive Nuno Matos says the banking giant is working to get its mortgage growth back on track, after new lending was held back by staffing problems and its decision to not participate in a federal government scheme to help first home buyers.

The attempt to regain market share in mortgages shows the challenges facing Matos as he slashes costs but also tries to hit ambitious targets for revenue in Australia’s highly competitive retail banking market, where ANZ has struggled lately.

Matos’ comments came as the bank also revealed former boss Shayne Elliott missed out $13.5 million in bonuses during his last two years at the bank, as the board determined he should not get incentive payments he was due to receive due to the bank’s regulatory woes.

Elliott was one of several executives to miss out on bonuses after ANZ settled several court cases with the watchdog earlier this year, copping a $240 million fine.

ANZ’s results, released on Monday, underscored the tough backdrop facing the lender in retail banking, with its Australian retail banking arm posting a 35 per cent decline in profits and flat net interest income.

Overall, ANZ’s total cash profits dropped 14 per cent to $5.8 billion last financial year, weighed down by charges relating to Matos’ move to slash 3500 jobs earlier this year, and for previously announced regulatory fines.

Matos also told investors the bank’s mortgage portfolio had grown more slowly than the market average in recent months, due to staff attrition in its home loan processing team, as well as the fact it was not participating in the government’s first home buyer program.

The program, which covers the cost of lenders’ mortgage insurance on deposits between 5 and 20 per cent for first home buyers, kicked off in October and the bank estimates the scheme has lifted the size of the first home buyer market by about 10 per cent. Matos indicated ANZ was keen to participate in the government scheme and help boost its growth by the end of the current half, in March.

“We will lose some share until March ’26, and after that, we should be in line with the system again,” Matos said.

The loss of market share in home lending comes as analysts have generally backed Matos’ action to curb costs, while also saying it will be hard for ANZ to hit ambitious financial targets Matos has set for later this decade.

UBS analyst John Storey said ANZ’s explanation for its loss of market share in mortgages made sense, but also raised questions about the difficulties ANZ would face in growing revenue as it also slashes jobs.

“I ultimately think ANZ becomes a bit more internally focused. You can see they are already growing below system,” Storey said. “It’s quite obvious that they’ve lost share across both business and commercial, and retail, over the last four months.”

As well as publishing its results on Monday, ANZ also revealed it had made major cuts to bonuses in response to problems with “non-financial risk” management.

ANZ’s annual report said neither Elliott nor his successor, Matos, had received a short-term bonus for the 2025 year, and the bank had also cancelled incentives that Elliott had been due to receive.

The ANZ board took the action, and also decided to pay no short-term bonuses to its top Australian-based executives, after ANZ earlier this year agreed to a $240 million penalty to settle four separate legal cases from the corporate watchdog. In doing so, it admitted to unconscionable conduct on a major government bond deal, incorrect reporting of trading data, and misconduct affecting nearly 65,000 customers.

Holly Kramer, an independent non-executive director who chairs ANZ’s people and culture committee, said equity due to vest to Elliott and other executives in late 2025 would be forfeited “to ensure overall consequences were appropriate and proportionate”.

She said the board had also forfeited the 2026 equity on foot for Elliott and former head of Australian retail, Maile Carnegie. Carnegie missed out on $4.4 million in bonuses, the report said.

“The board considers that the major reductions are a demonstration of a strong accountability culture and is committed to continuing to clearly link remuneration outcomes to performance,” Kramer said.

Monday’s results, the bank’s first results under Matos, showed profits had taken a hit from $1.1 billion in previously announced significant items, including restructuring charges from mass job cuts, and the record $240 million fine from earlier this year.

The bank said that excluding the significant items, its profits were flat for the year to September 30, as Matos reiterated that “action is needed” to improve the bank’s financial returns and catch up to rivals.

“Looking at our four main divisions, institutional and New Zealand have performed consistently well, however Australia retail and business and private bank have underperformed,” Matos said.

ANZ kept its final dividend unchanged at 83¢, as flagged by Matos at the recent investor day.

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