Free audio stream, including stories that are padlocked on our site. Listen on any device, anywhere. Updated twice daily. The audio stream takes several seconds to start on Android devices.Launch Radio player
ASB Bank, the local unit of Commonwealth Bank of Australia, posted a 7 percent gain in first-half cash profit on increased mortgage and business lending and saw growth in interest income outpace operating expenses.
Cash profit, which excludes some one-time items, rose to $348 million in the six months ended December 31 from $324 million a year earlier, according to the parent company's interim results. Net interest income rose 5 percent to $666 million, while other banking income climbed 12 percent to $180 million.
The value of home loans rose 3 percent to $38.7 billion in the first half and other interest-bearing assets rose 11 percent to $17 billion. Rural lending rose 12.7 percent and business lending gained 9.4 percent. Deposits were up 3 percent.
"This result builds on the positive momentum established in the previous financial year with good balance sheet growth across all customer segments including home, business and rural lending," ASB chief executive Barbara Chapman says.
The bank's share of the home loan lending market was little changed at 22.1 percent in the first half, while its share of retail deposits fell to 20.2 percent from 20.6 percent. Business lending share rose to 9.8 percent from 8.9 percent.
It had 17.7 percent of retail funds under management, up from 15.1 percent a year earlier, and annual inforce premiums share of 29.7 percent, down from 30.2 percent.
ASB Kiwisaver, the nation's largest KiwiSaver scheme, lifted funds under management by 31 percent in the 12 months through December.
Net profit fell 2 percent to $365 million. The net interest margin widened by 10 basis points, it says.
The local bank's loan impairment expense doubled to $22 million.
Sydney-based Commonwealth Bank's total cash profit from New Zealand rose 7 percent to $393 million, including $44 million from its Sovereign insurance unit, down from $49 million a year earlier.
The parent company, Australia's biggest lender, lifted first-half profit by 1 percent to $A3.66 billion, helped by gains in retail banking and wealth management. Its net interest margin widened by 4 basis points to 2.1 percent
Earnings from retail banking rose 13 percent to $A1.5 billion and earnings from wealth management profit rose 10 percent to $A334 million, it said today.
Commonwealth Bank's shares last trade at A$65.52 on the ASX and have gained 4.7 percent this year.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- 'We've never seen a competitor in any category behave in this manner' — MYOB on Xero man's outburst
- OIO judges Dotcom ‘good character’ – despite hacking, insider trading, reckless driving
- RAW DATA: Lisa Owen interviews a British foreign fighter
- Orion CFO Rodney Hyde to leave after company reports earnings in May
- Fonterra's Glencoal says Waikato coal mine not on hold, just delayed