News: ANZ Australia and New Zealand Banking announces first quarter 2016 trading update, page-7

What does the latest ANZ report suggest to me? Hang on I'll just pick up my glass ball and have a peak at its reflection.

The future for ANZ looks focused on reducing costs and not losing money in its various business activities. Protecting the quality of the credit book will become paramount. Many aspects of the old banking philosophy will re-emerge. Banks will preserve capital by allowing other financials (predominately Banks) to lose money.

These themes now seem to be the guiding mantra of Shayne Elliott. Eventually they will flow into the ANZ way of doing business.

Despite the above, ANZ losses will increase in coming quarters. Existing credit quality will deteriorate further and perhaps even significantly in the South-East Asia region.

The next dividend will increase modestly and from then on probably remain flat from 2017 on wards.

An out of cycle rate rise will happen first before a cut to the divvy. A divvy cut is the signal to shareholders that ANZ or any of the other biggies are heading for a credit crunch.

The days of the empire builder are over. This is the age of the bean counter. Shayne Elliott is a classic bean counter and ANZ shareholders are fortunate to have such an experienced numbers man at the helm. He has plenty of smarts and first-hand experience of the South-East Asia region.

I plan to remain invested in ANZ. Now can I put down my glass ball? The dam thing is getting heavy.

DYOR