Shares in the big four banks were under selling pressure over the third day of hearings at the royal banking commission, which was formed to investigate misconduct in the financial industry, proceeds.
At the time of writing, Commonwealth Bank of Australia (ASX: CBA) was down 0.91% to $75.85, Westpac Banking Corp (ASX: WBC) was down 0.94% to $29.66 and National Australia Bank Ltd (ASX: NAB) was down 1% to $29.68. The Australia and New Zealand Banking Group (ASX: ANZ) share price fell 1% to $28.06.
According to the Sydney Morning Herald, analysts at Morgan Stanley think that a negative outcome of the commission's inquiries may convince ANZ to limit share buybacks in the future to retain a strong capital position.
ANZ divested two major non-core assets at the end of last year – a 20% interest in the Shanghai Rural Commercial Bank and its life insurance business – and found itself in the position of returning around $5 billion of surplus capital to its shareholders.
An initial $1.5 billion on-market buyback announced in December 2017 should be completed in May, but further buybacks may fall short of the $4 billion previously forecasted.
