News: IFL UPDATE 1-Australia's IOOF posts 24 pct fall in annual profit

(Adds context on ANZ deal, legal settlement)

Aug 7 (Reuters) - Australian wealth manager IOOF Holdings Ltd (IFL) said on Tuesday its annual profit fell 24 percent, partly hurt by costs related to its acquisition of Australia and New Zealand Banking Group's (ANZ) wealth management business.

Net profit was A$88.3 million ($65.18 million) for the year ended June 30, compared with a profit of A$116 million a year ago, the listed wealth manager said.

IOOF, which bought ANZ's pension and wealth business last year for A$975 million, said advisory, integration and finance costs of about A$17 million from the deal had weighed on its profit.

The sale came as Australian banks exit their insurance and wealth businesses in the face of growing competition from global players, tougher capital requirements and closer scrutiny from a powerful public inquiry into finance sector misconduct.

Barring one-off items like the ANZ deal, IOOF said net profit rose to A$191.4 million from A$169.4 million a year ago.

Australian financial services stocks are down sharply since February when the so-called Royal Commission began hearing allegations of industry-wide fraud, bribery, irresponsible lending and deceiving a regulator.

IOOF said in a separate announcement that its unit Australian Executor Trustees had agreed to settle legal proceedings regarding its role as debenture trustee of Provident Capital. The unit is expected to pay about A$44.3 million as part of the settlement.

The wealth manager declared a final dividend of 27 cents per share, in line with its dividend a year ago. ($1 = 1.3546 Australian dollars)