OREANDA-NEWS. Fitch Ratings views Australia and New Zealand Banking Group Limited's (ANZ, AA-/ Stable) announcement of a capital raising exercise today as a credit-positive supporting its current ratings.

ANZ announced that it was raising up to AUD3bn to boost its capital levels in part to address the recent regulatory changes announced by Australian Prudential Authority Regulator (APRA) on 20 July 2015. The capital raise is likely to add between 65 basis points (bp) and 78bp of additional common equity tier 1 (CET1) capital, increasing the pro-forma CET1 ratio to up to 9.3% as of end-June 2015. ANZ's capital raising plan follows an AUD5.5bn capital increase undertaken by National Australia Bank Limited (AA-/ Stable) in May 2015 which was partly to address anticipated changes in regulatory capital requirements.

In an announcement in July 2015, ANZ indicated that the introduction of minimum risk-weightings for mortgages of 25% would result in an additional capital requirement of AUD2.3bn relative to the requirement as at 31 March 2015. The AUD3bn capital raise consists of a fully-underwritten AUD2.5bn institutional placement with large global banks and an up to AUD500m share purchase plan offered to existing shareholders. This also allows for ANZ's anticipated mortgage growth over the next 12 months.

Fitch expects the major Australian banks to continue to increase their capital positions using a range of measures, including the usage of dividend reinvestment plans, capital raising and retained earnings, over the next 24 months. Asset sales are also an option for ANZ.