ANZ vs WBC shares: Which is the better investment?

Australia and New Zealand Banking Group vs Westpac Banking Corp shares: How To Separate Them

If you are choosing between ANZ and Westpac, you may want to start by asking yourself whether you would prefer the bank that currently looks cheaper and higher yielding, or the bank that looks a bit more like a disciplined rebuild with stronger operational clean-up?

Neither of two are priced like CBA, neither has the same “premium franchise” aura, and both are trying to convince you they can deliver solid returns without needing a heroic rerating. The difference is that ANZ currently looks more like the improving value-and-income story, while Westpac looks more like the cleaner turnaround-and-execution story.

ANZ’s latest half-year result, released on 1 May 2026, showed statutory profit of A$3.65 billion, cash profit of A$3.78 billion, cash RoTE of 11.6%, a 12.39% CET1 ratio, and an 83 cent interim dividend with franking rising to 75%. Westpac’s 1H26 result, released on 5 May 2026, showed A$3.4 billion statutory net profit, A$3.5 billion net profit excluding notable items, a 12.4% CET1 ratio, and a 77 cent fully franked interim dividend.

Why Choose ANZ Shares

ANZ is the bank that currently looks more like a value-and-income idea with improving momentum, which means you are buying a major bank that finally looks like it is showing more visible improvement in returns.

The 1H26 result was meaningfully better than the prior half, especially after adjusting for 2H25 significant items. ANZ reported cash profit of A$3.78 billion, cash RoTE improved to 11.6%, and the cost-to-income ratio was 49.4%. Credit quality also remained solid, with non-performing exposures to total credit exposure at 0.55%, down from 0.57% at 30 September 2025.

There is also an income and capital argument. ANZ’s board proposed an 83 cent interim dividend, with franking rising from 70% to 75%, and said no discount would apply to the dividend reinvestment plan. The CET1 ratio of 12.39% remains comfortably strong, and liquidity metrics stayed well above regulatory minimums, with an average liquidity coverage ratio of 132% and a net stable funding ratio of 115%. That gives you a bank that looks well capitalised and still willing to return cash.

The uncertainty with this one is that ANZ is still in the middle of a strategic transition which can absolutely create value, but it also means you are still backing change rather than just enjoying a fully settled, mature operating model. The bank also explicitly flagged greater economic uncertainty from Middle East tensions and booked a A$175 million collective provision overlay for potential impacts from that conflict. Momentum is improving, but there remains work to be done.

Why Choose WBC Shares

The case for Westpac is that you are buying a major bank with a solid franchise, strong capital, and a clearer operational-improvement program than it had a few years ago.

Its 1H26 result showed A$3.414 billion of statutory net profit and A$3.483 billion excluding notable items. Revenue was A$11.3 billion, pre-provision profit was A$5.5 billion, and expenses were down 6% versus 2H25, or down 2% excluding restructuring. That is the kind of result that tells you Westpac is still doing a lot of internal clean-up work, but making progress.

There is also a balance-sheet and lending-growth case. Westpac’s 1H26 presentation showed deposits rising from A$723.0 billion to A$745.2 billion, while gross loans rose from A$856.4 billion to A$890.3 billion. The bank also highlighted improvements in mortgages and customer service metrics, alongside continued investment in UNITE and digitisation.

The downside is that the result was still a bit messier than ANZ’s. Net profit excluding notable items was only up 1% on 1H25, and impairment charges annualised to 10 basis points, up from 4 basis points in 2H25. Westpac also remains a heavy investor in transformation, with A$919 million of investment spend in 1H26. So if you buy Westpac, you are still underwriting execution.

Dividend, Income & Valuation

If income matters most to you, ANZ has the stronger case right now. The current data shows ANZ yielding 4.66% versus 3.98% for Westpac. The latest payouts show that ANZ proposed an 83 cent interim dividend, while Westpac declared 77 cents, fully franked. Westpac’s dividend is cleaner from a franking perspective, but ANZ currently gives you the higher headline yield and the larger interim payout.

From a valuation standpoint, the two trade close on multiples with:

• ANZ: ~18.5x earnings
• Westpac: ~19.3x earnings

That is not a huge gap, but it still matters if you are valuation-sensitive. Westpac’s counterargument is that you are paying for a more visible execution and growth in revenue that could show up in the valuation multiples in future earnings reports.

Westpac still looks stronger on profit margin and ROE, whilst ANZ looks stronger on current earnings momentum, and its latest half-year result showed a clearer step-up in returns, capital, and dividend settings. Westpac’s 1H26 result was respectable and operationally disciplined, but ANZ’s result felt more like a bank that is currently getting more leverage from its reset.

Which is the better long term investment?

If we are rating the more attractive value-plus-income profile today, ANZ is shaping up as a better long-term investment case. You are getting the lower multiple, the higher yield, strong capital, and a fresh result showing better returns and improving execution. That is a good combination if you want a major bank that does not need a premium rating to work for you.

If you want the bank with the more obvious operational-rebuild and simplification angle, Westpac still has a real case. Its 1H26 result showed cost discipline, stronger lending and deposit balances, and continuing progress on technology and operating-model work. But for you, that case looks slightly less attractive right now because you are not being paid more in yield and you are not getting a lower multiple in exchange.

In the end, the better long term investment for you will very much depend on your personal goals, and that is something you should discuss with your financial advisor. Considering a more portfolio based approach to the sector that incorporates ETFs, or a few of the leading names will give you a better risk management approach, which in the long run is often best.