ANZ bank is to spend $425 million buying back some of its shares.

The bank said it was comfortable with its capital position and would therefore undertake a share buyback to offset the dilutive impact of its recent issue of new shares.

ANZ’s dividend reinvestment plan and bonus option plan offered at its half year results in April allowed shareholders to take up new shares rather than receive a cash dividend.

ANZ’s buyback will begin no earlier than June 13.