Asian push pays off for ANZ ANZ chief executive Mike Smith says he is upbeat about the state of China's economy. ANZ chief executive Mike Smith says the bank's ambitious push into Asia is paying off for the lender, which is on track to post a profit of more than $6 billion this year despite a "soft" domestic economy. Drawing the curtain on a series of healthy results for the big banks, ANZ recorded 6.2 per cent annual profit growth in the December quarter, handing down cash earnings of $1.53 billion on Friday. The growth was helped by strong returns from its global markets business, tight control on costs, and a push to sign up more home loan and deposit customers. In a sign its plan to obtain more of its earnings from Asia may be bearing fruit, it said combined earnings from China, Hong Kong and Taiwan had become the third-biggest source of profits, after Australia and New Zealand. Despite growing competition in the region putting the squeeze on margins in its overseas businesses, Mr Smith maintained earnings were benefiting from the push into Asia. "Together with the major domestic businesses we have in Australia and New Zealand, our strategy is providing a unique connectivity to Asia's growth, and of course it's giving us greater earnings diversification," Mr Smith told analysts. Although there are concerns China's growth rate slowed in early 2013, Mr Smith said he was "upbeat" about the state of its economy. ANZ's move to curb expenses also aided the bottom line, with costs falling slightly after the bank cut staff numbers last year. After a run of better than expected results from big banks in recent weeks, analysts said ANZ's performance was solid rather than spectacular. An analyst at Deutsche Bank, James Freeman, said ANZ would need to expand its margins in order to meet the market's expectations for profit growth. Some analysts also said that the bank's performance lagged slightly behind its domestic peers, and had relied on a strong contribution from its relatively volatile global markets division, where income grew 26 per cent to $544 million. ANZ's result comes as the big lenders continue to post solid profit growth in spite of weak demand for credit and high deposit costs. A strong performance in home lending underpinned a record $3.78 billion half-year profit from Commonwealth Bank, and NAB, the laggard among the big four last year, also posted better than expected quarterly earnings of $1.45 billion. Westpac is not reporting on its performance during the current earnings season but is tipped to benefit from a widening in margins from domestic lending to consumers. The earnings growth has come against a backdrop of weak demand for credit, with annual growth in mortgage lending at its slowest pace on record, according to Reserve Bank figures. But the profit margins in Australian consumer banking have widened due to lower funding costs and lenders' decisions to only pass on part of the cash rate cuts to customers. ANZ said the recent flooding in Australia had not materially affected the bank's provisions for bad debts.